Publications

We study the value of delegating authority over income tax audit policy, arising from incompleteness of contracts. Suppose a utilitarian government’s ability to commit is limited to aggregate dimensions of its audit policy, as publicly verifiable…

The coexistence of direct financing and intermediation is shown in a model with asymmetrically informed borrowers and lenders. Using a game theoretic approach we first prove the existence of optimal contracts between (a) firms and intermediaries…

Abstract not available.

Efficient employment contracts usually fail to compensate workers for the effects of post-hiring events and decisions when changing jobs is costly. Then, when there are executives and managers with authority to make discretionary decisions,…

Our paper examines whether managers manipulate earnings. We begin by modeling how a specific accounting number, the provision for bad debts, would be reported in the absence of earnings management. This model is motivated by generally accepted…

Awarded the 1996 Strategic Management Society/ John Wiley award for outstanding contribution to the development of the field of strategic management. For this award, a paper must have been published at least five years earlier.

Fisher’s finite sample distribution results for squared multiple correlation coefficients and F tests are extended to situations in which the observations are drawn from independent, but not necessarily identical, normal samples. This…

One explanation for the empirically observed underpricing of new issues is the existence of an adverse selection problem faced by uninformed investors in the presence of informed investors. Rather than excluding informed investors from initial…

Consider the problem of Bayesian implementation, i.e., of constructing mechanisms with the property that all equilibrium outcomes agree with a given choice rule. We show that a general procedure is to start with an incentive compatible revelation…

In this paper, we explore the role of franchising arrangements in improving the coordination between channel members. In particular we focus on two elements of the franchising contract, namely, the royalty structure and the monitoring technology…

Although the rational expectations hypothesis is widely applied in asset pricing models with differentially informed traders, the extent to which markets actually aggregate and transmit information is an open question. In this study we report the…

Abstract not available.

Negative voting occurs when voters respond more strongly to political actions or outcomes they oppose than to comparable actions or outcomes they favor. This paper discusses the possibility that negative voting is an artifact. We develop a simple…

Abstract not available.

Link to Book information 

Our aim in these notes is to exposit a model of optimal equilibrium growth. The model is strictly in the Solow tradition. The model has two features which distinguish it from most other work on the subject. These are, first, that the model is…

The authors present a diffusion model in which individual consumers adopt an innovation if its risk-adjusted utility exceeds a reservation utility threshold. This threshold may be a function of innovativeness and existing product holdings. As the…