When ability complements effort, we would expect effort to increase with variables that proxy for ability. For example, we show that the hours worked by entrepreneurs should increase in experience, a proxy for ability. Yet, even if education is positively correlated with entrepreneurial ability,...

This paper considers a community where contracting institutions are weak. If social sanctions against opportunism rise in times of stress, then some good projects may be born out of misfortune.

This paper considers a community where contracting institutions are weak. If social sanctions against opportunism rise in times of stress, then some good projects may be born out of misfortune.