Richard Holden of UNSW Business School reviews “Fintech Explained: How Technology Is Transforming Financial Services” by Michael R. King. The Econlit abstract of this book begins: “Explores how entrepreneurial startups, mature businesses, digital-only banks, and global technology companies are transforming the customer experience in financial services, focusing on financial technology (fintech) applications developed since the mid-2000s that primarily target individuals and small business customers.”

Standard intuitions for optimal gerrymandering involve concentrating one's extreme opponents in “unwinnable” districts (“packing”) and spreading one's supporters evenly over “winnable” districts (“cracking”). These intuitions come from models with either no uncertainty about voter preferences or only two voter types. In contrast, we characterize the solution to a problem in which a gerrymanderer observes a noisy signal of voter preferences from a continuous distribution and creates N districts of equal size to maximize the expected number of districts she wins. Under mild regularity conditions, we show that cracking is never optimal—one's most ardent supporters should be grouped together. Moreover, for sufficiently precise signals, the optimal solution involves creating a district that matches extreme “Republicans” with extreme “Democrats,” and then continuing to match toward the center of the signal distribution.

We consider the robustness of extensive form mechanisms to deviations from common knowledge about the state of nature, which we refer to as information perturbations . First, we show that even under arbitrarily small information perturbations the Moore-Repullo mechanism does not yield (even approximately) truthful revelation and that in addition the mechanism has sequential equilibria with undesirable outcomes. More generally, we prove that any extensive form mechanism is fragile in the sense that if a non-Maskin monotonic social objective can be implemented with this mechanism, then there are arbitrarily small information perturbations under which an undesirable sequential equilibrium also exists. Finally, we argue that outside options can help improve efficiency in asymmetric information environments, and that these options can be thought of as reflecting ownership of an asset.