Economists have long recognized that the time costs of using different forms of money can be significant and potentially affect the type of media of exchange used. Banks and retailers recognize these costs as well, and market transponder devices to pay for tolls, food and gas as a way to...

Recent theoretical work by Cooley and Quadrini (2001) highlight the role of financial frictions in models of firm dynamics. This paper investigates empirically the implications of the Cooley and Quadrini (2001) model for the determinants of firm size dynamics with special emphasis on financial...

The European Environmental Agency (EEA) assigns periodically air pollution emission rights among the EC member states, who, in turn, share their respective endowment among the polluting firms. There exists a moral hazard problem since the EEA does not observe abatement efforts. We propose a...

In this paper we explore the information processing problem of the firm by modeling the firm as type of network, which is comprised of two kinds of agents, 'searchers' and 'managers.' The searchers explore the external environment and report the information to the managers. We explore the role...

Barr and Saraceno (JEDC, forthcoming) model the firm as a type of artificial neural network (ANN) which plays a repeated Cournot game. Each period, the network/firm must estimate the relationship between environmental conditions and optimal output. Among other results, the paper develops the...

There are two key stylised facts about the extinction patterns of firms. First, the probability of extinction is highest at the start of the firm"s existence, but soon becomes more or less invariant to the age of the firm. Second, the relationship between the size and frequency of firm...

We analyze within a dynamic model the growth impact of private capital investment if the accompanying adjustment costs are a function of governmental activity. The impact of the productive public input is twofold: it (i) enhances private capital productivity and (ii) reduces adjustment costs. We...