This paper examines how a surface water market affects the performance of a groundwater basin that is in open access. The market only solves the groundwater over-extraction problem when pumping costs are high, while market failure arises when the common pool resource (CPR) problem is severe. I...

This paper reports experiments motivated by ongoing controversies regarding tick size in markets. The minimum tick size in a market dictates discrete values at which bids and asks can be tendered by market participants. All transaction prices must occur at these discrete values, which are...

This paper demonstrates a novel mechanism through which emissions cap-and-trade mitigates production-side distortion vis-à-vis an emissions cap policy under a heterogeneousfirm framework with imperfect competition. When clean and dirty inputs are gross substitutes, we find that a pro rata...

The inter-temporal resource allocation efficiency of a property rights-based common-pool resource system is challenged by a cost externality when one user’s extraction raises the extraction cost for others. This paper builds a dynamic resource allocation model to illustrate the efficiency loss...

This paper explores the impact of political network on insider trading activities in China. With a comprehensive network mapping links between politicians and firm Chairmen, we find that stronger political network discourages insider trading. Such effect is stronger among long-standing,...

The inter-temporal resource allocation efficiency of a rights-based common-pool resource management system is threatened by a stock externality when one user’s extraction lowers the resource stock and raises the extraction cost for others. This paper proposes a novel decentralized rights-based...

In this paper, we set up a game theoretical model in which an incumbent and an entrant choose their respective R&D strategies to compete with each other. Our paper contributes to three major debates regarding a firm's R&D strategy: the incumbent's and the entrant's choice between a radical R&D...