We estimate the effects of a mandate allocating a third of corporate board seats to workers (shared governance). We study a reform in Germany that abruptly abolished this mandate for certain firms incorporated after August 1994 but locked it in for the older cohorts. In sharp contrast to the...

Who should control the firm? What should be the firm's objective function? If contracts are incomplete, then the group of input providers that most needs their interests protected should be allocated control rights to the firm. Existing theories argue that the suppliers of capital are most in...

We give an overview of the "German model" of industrial relations. We organize our review by focusing on the two pillars of the model: sectoral collective bargaining and firm-level codetermination. Relative to the United States, Germany outsources collective bargaining to the sectoral level,...

We study the descriptive and substantive representation of workers through worker representatives, focusing on the selection of German works council representatives and their impact on worker outcomes. Becoming a professional representative leads to substantial wage gains for the elected,...

We show that armed actors refrain from using their power to arbitrarily steal from an economy if, and only if, the armed actors' property rights over stealing from that economy are secure. By 2009, armed actors taxed, administered, and protected various villages in Democratic Republic of the...

We study two parties who desire a smooth trading relationship under conditions of value and cost uncertainty. A rigid contract fixing price works well in normal times since there is nothing to argue about. However, when value or cost is exceptional, one party will hold up the other , damaging...

This paper presents a simple new method for estimating the size of 'wealth effects' on aggregate consumption. The method exploits the well-documented sluggishness of consumption growth (often interpreted as 'habits' in the asset pricing literature) to distinguish between short-run and long-run...

Real and private-value assets--defined here as the sum of real estate, infrastructure, collectibles, and non-corporate business equity--is an investment class worth an estimated $85 trillion in the U.S. alone. Furthermore, private values can affect pricing in many other financial markets, such...

How do the different elements in the standard bundle of property rights, including those of possession and transfer, influence the shape of cities? This paper incorporates insecure property rights into a standard model of urban land prices and density, and makes predictions about investment in...

Private ownership should generally be preferred to public ownership when the incentives to innovate and to contain costs must be strong. In essence, this is the case for capitalism over socialism, explaining the dynamic vitality' of free enterprise. The great economists of the 1930s and 1940s...