We present a model of financial contracting in the presence of asymmetric information between entrepreneur and investor. Either liquidation threat or governance control can be used to protect investor’s interests against expropriation risk. The two parties first agree to a financial...

This paper presents a model of vertical restraints with unobservable contracts in a market where retailers compete in price and service. The equilibrium contracts under the franchise and the resale price maintenance arrangements are shown to differ in the way they lessen competition between...

This paper presents a model of vertical restraints with unobservable contracts in a market where retailers compete in price and service. The equilibrium contracts under the franchise and the resale price maintenance arrangements are shown to differ in the way they lessen competition between...