I study the design of two different institutions to evaluate the welfare implications

of counterfactual policies. In particular, I analyze (i) the problem of assigning

students to colleges (majors) in a centralized admission system; and (ii) an auction

where the seller can use securities to determine winner’s payment, and bidders

suffer negative externalities. In the former, I provide a novel methodology to

evaluate counterfactual policies when the admission mechanism is manipulable.

In the latter, I determine which instrument yields the highest expected revenue

from the class of instruments that combines cash and equity payments.