We model a firm in an institutional market setting, consisting of a production technology and its governance. The governance consists of a hierarchical firm structure, a cost efficiency parameter,and an internal pay system. The depth of the firm is determined by profit maximization under the...

In this paper we analyze an equilibrium search model with threesources for wage andunemployment differentials among workers with the same (observed)human capital but different appearance (race): unobservedproductivity (skill), search intensities and discrimination (Becker 1957) due to an...

In this paper we consider the problem of the control of access to a firm's productive asset, embedding the relevant decisionmakers into a general structure of formal authority relations. Within such an authority structure, each decision maker acts as a principal to some decision makers, while...