We study adoption of a costly new technology when the profitability of the new technique differs over individuals and there is uncertainty about these individual-specific differences. We establish that such individual-specific uncertainty results in a financing constraint when debt contracts are...

This paper investigates a learning model in which information about a worker's ability, unobserved to both the worker and the firm, can be acquired in any period by both parties by observing the worker's performance at a given task. Tasks are differentially informative about productivity: more...

This paper provides formal treatment to the idea of patenting as a form of market stealing between R&D firms. It extends the creative destruction literature by allowing innovations to build off each other forming a network of ideas. Patent citations keep track of this network. The theory maps...

In this paper, we study the dynamics of innovation financing as a new industry emerges. Specifically, in an environment where the profitability of an industry is uncertain, we consider the dynamics of the adoption of innovations/projects and the relative shares of bank and venture capital...

The question of how technological change affects labor markets is a classical one in macroeconomics. A standard framework for addressing this question is the matching model with vintage capital and exogenous technical progress. Within this framework, it has been argued that the impact of...

The paper presents a vintage capital model that is consistent with the the relationship between the rate of embodied technical change and the rate of entry and exit across industries. In the model, the costs imposed by the regulation of entry may bias the sectoral composition of an economy...

The five-year relative survival rate from all malignant cancers increased from 50.0% in 1975-1979 to 62.7% in 1995. This increase is not due to a favorable shift in the distribution of cancers. A variety of factors, including technological advances in diagnostic procedures that led to earlier...

We construct a bilateral search model of the housing market in which agents differ in their flow rewards while searching. Buyers and sellers enter the market with high flow rewards, but move at a Poisson rate to a state with low flow rewards if they do not transact in the meantime. We...

Reputation systems have emerged as important sources of information in modern economies. This paper develops a model of reputation systems that puts buyers and sellers inside a stochastic environment involving asymmetric information and search frictions, and gives them a set of options with...