We investigate the role of mutual trust in long-term vertical relationships involving trades of complex goods. High complexity is associated with high contract incompleteness and hence the increased relevance of trust-based relational contracts. Contrary to expectations, we find that changes in...

In the last decades, technologies became more complex which increased the degree of uncertainty in R&D. To overcome the uncertainty, firms frequently engage in R&D collaborations, e.g., Research Joint Ventures (RJVs), and licensing agreements. While RJVs are well explored in the literature, very...

This paper presents a dynamic model of a competitive R&D and production duopoly subject to knowledge spillovers. Two asymmetric firms operate for a limited period of time and dispose their knowledge capital in the end. Both firms and the social planner prefer the R&Dcooperative strategy over the...

We investigate the dimensions through which R&D spillovers are propagated across firms via cooperation through Research Joint Ventures (RJVs). We build on the framework developed by Bloom et al. (2013) which considers the opposing effects of technology spillovers and product market rivalry, and...

We investigate the effect of a vertical merger on downstream firms' ability to collude in a repeated game framework. We show that a vertical merger has two main effects. On the one hand, it increases the total collusive profits, increasing the stakes of collusion. On the other hand, it creates...

Taxes levied on production processes (e.g. VAT), are today a very important source of government revenues in developed economies. Theories of optimal taxation conclude that these taxes are detrimental to production efficiency, when firms operate in perfectly competitive markets. These theories...

Platforms often use fee discrimination within their marketplace (e.g., Amazon, eBay, and Uber specify a variety of merchant fees). To better understand the impact of marketplace fee discrimination, we develop a model that allows us to determine equilibrium fee and category decisions that depend...

Little is known theoretically, and even less empirically, about the relationship between firm boundaries and the allocation of decision rights within firms. We develop a model in which firms choose which suppliers to integrate and whether to delegate decisions to integrated suppliers. We test...

This paper discusses how international trade is organized from export to trans-boundary transport to import. All evidence suggests that the transport sector is independent, may exercise market power and features strong economies of scale. We develop a model of a transport industry that operates...