In certain industries, sales agent contracts include provisions for sales commissions and clawbacks of commissions if clients are not retained. We show that contracts with these features arise in environments having up-front selling costs recouped from ongoing sales; heterogeneous customers;...

The Canadian banking system experienced a prolonged period of stability prior to the introduction of deposit insurance in 1967. Documenting the reasons for this stability provides important evidence in the debate over the impact of mandatory flat-rate deposit insurance. In this paper we use new...

This article analyzes a monopolist's quality and advertising policies and evaluates their social optimality. Our model considers a rational, though not fully informed, consumer who holds prior perceptions about aspects of quality, which determine his purchase pattern. These quality perceptions...

Since the US Dealer Day in Court Legislation of 1956, many states have altered the nature of written contracts between automobile manufacturers and their dealers. In particular, restrictions have been placed on the manufacturers' rights to add new dealers to market areas of existing dealers and...

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This article examines requirements tying of a competitively supplied good to a monopolized good. It expands the set of market conditions in which this instrument is known to be profitable. With heterogeneous, privately informed buyers, a firm can profit by tying two goods even when demands for...

Money and Medicines: An Economic Analysis of Reference Pricing and Related Public-sector Cost-containment Systems for Pharmaceuticals with Special Reference to New Zealand, by Alan Woodfield, John Fountain and Pim Borren (Merck Sharp and Dohme (New Zealand) Ltd.), October 1997 Tigers in New...