Technology transfer agreements between universities and industrial companies usually involve royalties, sublicensing considerations and allocation of equity. This article extends the analysis of my previous one ("The Economic Sense of Royalty Rates", ewp-fin/970903)to deal with sublicensing...

On the basis of focused interviews with managers of foreign parent banks and their affiliates in Central Europe and the Baltics, we analyse foreign banks’ small business lending and internal capital markets. This allows us to complement the standard empirical literature, which has difficulty...

Academic institutions, involved in technology transfer to industry, are always concerned about the "fairness" of the royalty rate payable to them. The common method used by practitioners is the "Industry-Standard Approach" which is based mainly on past experience. However such approach is very...

This article investigates which firms borrow directly from the capital markets and which raise funds through intermediaries. Our empirical results show that large companies with abundant cash and collateral tap the credit markets directly. These markets cater to safe and profitable industries,...

In the Weighted Average Cost of Capital (WACC) applied to the free cash flow (FCF), we assume that the cost of debt is the market, unsubsidized rate. With debt at the market rate and perfect capital markets, debt only creates value in the presence of taxes through the tax shield. In some cases,...

We present a unified analytical theory of production and capital structure of firms. It is extended from an analytical theory of production, whose main result is an analytical formula of variable cost of production as a function of fixed cost and uncertainty. Problems on capital structure can be...

There has been an explosion of new forms of communications media for interpersonal communication. There is anecdotal evidence of people suffering from 'information overload' as a result of these developments. This paper presents the results from, and analysis of, a case study of a perceived...

I study the consequences of heterogeneity of skills for the design of an optimal unemployment insurance, using a principal-agent set-up with a risk neutral insurer and infinitely lived risk averse agents. Agents, who are characterised by different productivities or skills, are employed by firms...

Professional experts offer advice with the objective of appearing well informed. Their ability is evaluated on the basis of the advice given and the realized state of the world. We model this situation as a reputational cheap-talk game with continuous signal, state, and ability type spaces....

In sender--receiver games high--quality types can distinguish themselves from low--quality types by sending a costly signal. Allowing for additional, noisy information on sender types can radically alter sender behavior in such games. We examine equilibria where medium types separate themselves...