Hanlin Zhao (pronounced hAEn-lihn JOW)

Agents often choose based on expectations about uncertain attributes, yet researchers rarely observe the information behind those expectations. We develop two methods to estimate discrete choice models with heterogeneous, unobserved information sets. Our point-identification approach uses repeated realizations of the uncertain attribute to estimate its statistical process with observed predictors and recoverable latent factors, then represents conditional expectations as a finite mixture over these components. A complementary approach set-identifies preferences using partial information about expectations. Both methods apply to individual- and market-level data. Applications to firms' export decisions and consumers' automobile purchases show that our method corrects for substantial bias in preference estimates that arises when unobserved information heterogeneity is ignored.

Pharmaceutical innovation depends on strong primary patents that allow originators to recoup R&D costs. However, drug companies often engage in evergreening that prolongs patent protection by filing follow-on patents with little therapeutic gain. We study a policy lever that works with market forces to screen out weak follow-on patents: the Hatch-Waxman Act, which incentivizes challenges to evergreening patents by granting the first successful challenger a period of marketing exclusivity. We investigate how the length of first-filer exclusivity shapes generic firms' incentives to initiate challenges, which can curb the extra monopoly protection created by evergreening while preserving incentives for genuine discovery and protecting consumer welfare through earlier generic entry. Using a two-stage structural model that endogenizes challenge and entry decisions, we estimate the fixed costs of generic entry with moment inequalities. We find that the current 180-day exclusivity raises challenge rates by about 4 percentage points. Extending exclusivity primarily activates challenges in markets that would otherwise go unchallenged: a two-year exclusivity increases the challenge rate to 15.38%. Effective exclusivity is highly heterogeneous across therapeutic classes: reaching a 20% challenge rate requires roughly two years for antimicrobials but less than one year for genitourinary drugs.

Measuring consumer preferences requires knowing how consumers search. This paper develops a search-conduct test that distinguishes sequential from simultaneous search with differentiated products and outside options. The framework allows individual- and product-specific search costs and observed or unobserved searched attributes. Estimating both models with a unified maximum-likelihood approach, I develop a corrected Vuong test to compare their fit. Monte Carlo evidence shows that misspecified search conduct generates inconsistent preference estimates and that the test reliably selects the correct model.