I examine the work of POLANYI [1957] to extract from it hypotheses related to the emergence and operation of the capitalist system. I adapt models from the literature on complex adaptive systems and evolutionary game theory to build a fictitious society in which I "test" those hypotheses. The...

The paper is intended to provide a broad overview of the field of corporate governance, and to integrate recent research. Corporate governance is viewed from the perspective of the agency costs involved in obtaining equity investment from minority outside stockholders in a firm controlled by...

I examine the connection between the discursive dilemma and corporate law. The discursive dilemma (or doctrinal paradox) is a distinctive social choice problem that was first identified by Kornhauser and Sager and later used as the basis for a theory of organizational personality by Pettit. I...

I propose a model of mergers in which synergies and CEO power play a crucial role. A merger is modeled as a bargaining game between the acquiring and the target board of directors, with the gains from a merger divided according to the generalized Nash bargaining solution. The model's...

We study strategic communication between a principal and an agent when both have private information that collectively determines the principal's optimal decision. The principal's possession of decision-relevant information makes the agent uncertain how her report influences the principal's...

This paper analyses the risk-control trade-off in corporate ownership. It presents a simple model in which large shareholders decide their share depending on their risk aversion, risk-neutral effects attached to firm size, and the effectiveness of different (external and internal) mechanisms for...

We analyze the incentives for a controlling shareholder to acquire silent or controlling shares in a competitor. When it occurs, the acquisition is detrimental to minority shareholders of his firm, or to the target, or even to both. The ownership structure of firms turns out to be a key...

This paper studies a partial-contracting model where an agent may provide effort to increase a project´s scope before some later (operative) decisions have to be taken. Consistent with existing empirical evidence, we find a positive relationship between exogenous risk and delegation. That is,...

This paper analyzes, in a setup where only the control over actions is contractible, the rationale for delegation. An organization must take two decisions. The payoffs are affected by a random parameter, and only the agent knows its realization. If the principal delegates the control over the...

This paper contributes to the literature on the foundations of incomplete contracts. In a holdup framework, we provide two sets of conditions under which simple delegation of authority is the solution to the complete-contracting problem. In cases where overinvestment can be ruled out, delegation...