We analyze investment decisions when information is costly, with and without delegation to an agent. We use a rational …-inattention model and compare it with a canonical signal-extraction model. We identify three "investment conditions". In "sour …" conditions, no information is acquired and no investment made. In "sweet" conditions, investment is made "blindly", i.e. without …

current CEO who may have considerable power. Having signed a contract, the agent chooses how much effort to make to acquire … problem; how much information to acquire and what investment decision to make. As a consequence, the equilibrium contracts in … model E involve both bonuses and penalties. We identify lower and upper bounds on these, and study how the bonus and bonus …

current CEO who may have considerable power. Having signed a contract, the agent chooses how much effort to make to acquire … problem; how much information to acquire and what investment decision to make. As a consequence, the equilibrium contracts in … model E involve both bonuses and penalties. We identify lower and upper bounds on these, and study how the bonus and bonus …

paper develops a theoretical model of contract design in the new blockchain environment, and shows that the optimal contract … is a relatively simple and dynamically adjusting splitting rule. Under this type of smart contract, external financing …

A simple contracting environment with a creditor who has wealth and a entrepreneur who has a two-period investment … creditor prefers a contract that commits him not to refinance if and only if the extent of moral hazard problem is sufficiently …

We study SPACs in a continuous-time delegated investment model. Our model is built upon three unique features of SPACs … control over investment approval. Due to the misalignment in incentives, the sponsor has an increasing incentive to propose … control over investment approval reduces everyone’s welfare. This adverse effect is more pronounced if entrepreneurs …