This paper explores the location decisions of final-good producers under imperfect contract enforcement. The legal systems'; quality is measured by the contracting environment in each country. The final producers'; location decisions create different outcomes in terms of efficiency. We find one...

We examine the importance of agents' private information about their accident proneness and action, when the principal delegates via an optimal auction the undertaking of a risky activity to an agent. A unique feature of our model is that the risk-neutral principal can provide, at no cost,...

The information created and disseminated through the litigation process can have social value. Suppose a long-lived plaintiff is suing a defendant for damages sustained in an accident. The plaintiff may suffer similar damages in future accidents involving different defendants. Potential injurers...

Very little principal-agent analysis has been done within the fisheries economic literature. This paper conducts a principal-agent analysis of fisheries. Within a standard principal-agent model, the low-cost agent must be allowed the same level of effort as under complete information. This...

The paper investigates the incentives created by environmental policy instruments to adopt cleaner technology. In a framework with many asymmetric firms we show that, if the regulator has committed to a certain aggregate emission level before the new technology was available, taxes lead to...

In several landmark cases, the European Court of Justice has ruled that member states of the European Union are liable for damages caused by an infringement of European Law if the violation is sufficiently serious. This article analyses the incentive effects of liability rules on member states...

The decision to cooperate within R&D joint ventures is often based on expert advice. Such advice typically originates in a due-diligence process, which assesses the R&D joint venture's profitability, for example, by appraising the achievability of synergies. We show that if the experts who...

Decisions about intervention can be understood as decisions about tolerance, because an act of tolerance is an act of nonintervention, and, conversely, an act of intervention can be understood as an act of intolerance. But acts of tolerance, typically made under conditions of epistemic...

Although competition law and intellectual property have overlapping economic rationales, they frequently conflict. One area of conflict is vertical leveraging. This paper analyzes recent legislation and court decisions dealing with vertical leveraging. The main conclusion is that two policy...

After discussing some categories and modalities of a designed system change the paper turns to the example of the recent Russian company legislation. The design of two ambitious new company codes for large and small corporations implied a massive transformation of both the underlying economic...