This paper analyzes the incentives of a seller to provide (un)biased and (im)precise advice about a complex product … such as insurance, banking and telecommunication services. Misleading the buyers by biasing the advice upwards increases … the revenues but also the expected fine imposed by the authority. Making the advice less precise does not affect the …

We propose a theory of supervision with endogenous transaction costs. A principle delegates part of his authority to a …

This paper provides evidence that learning about demand is an important driver of firms' dynamics. We present a simple … model with Bayesian learning in which firms are uncertain about their idiosyncratic demand parameter in each of the markets … their beliefs following a new demand shock, the younger they are. To test this learning mechanism, we make use of a specific …

correlated learning may render it optimal to enter markets sequentially – an investment in market A is only followed by entry in …, we identify correlated learning across markets beyond alternative explanations as a key driver of gradualism in the …