This paper examines the macroeconomic properties of imperfectly competitive economies by modeling the labor market from the perspective of optimal contract theory. The point is to demonstrate that important properties of imperfectly competitive economies (such as underemployment equilibria,...

Using a simple two-period model, this paper attempts to explain uncertain interesting intertemporal properties of product warranties. Specifically, why does coverage generally fall over time and why is the typical warranty's life so much shorter than the expec ted life of the product it covers?...