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Contracting for Government Services: Theory and Evidence from U.S. Cities
Levin, Jonathan; Tadelis, Steven - National Bureau of Economic Research (NBER) - 2007
Local governments can provide services with their own employees or by contracting with private or public sector providers. We develop a model of this "make-or-buy" choice that highlights the trade-off between productive efficiency and the costs of contract administration. We construct a dataset...
Persistent link: https://www.econbiz.de/10005830392
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An Institutional Theory of Public Contracts: Regulatory Implications
spiller, pablo t. - National Bureau of Economic Research (NBER) - 2008
The fundamental feature of private contracting is its relational nature. When faced with unforeseen or unexpected circumstances, private parties, as long as the relation remains worthwhile, adjust their required performance without the need for costly renegotiation or formal recontracting....
Persistent link: https://www.econbiz.de/10005714643
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Testing Limits to Policy Reversal: Evidence from Indian Privatizations
Dastidar, Siddhartha G.; Fisman, Raymond; Khanna, Tarun - National Bureau of Economic Research (NBER) - 2007
We examine the effect of regime change on privatization using the 2004 election surprise in India. The pro-reform BJP … slated for definite privatization by the BJP dropped by 3.5 percent relative to private firms. Surprisingly, government …-controlled companies that were only under study for possible privatization fell by 7.5 percent relative to private firms. We interpret this …
Persistent link: https://www.econbiz.de/10005830631
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Profiting from Government Stakes in a Command Economy: Evidence from Chinese Asset Sales
Calomiris, Charles W.; Fisman, Raymond; Wang, Yongxiang - National Bureau of Economic Research (NBER) - 2008
contrast to the "privatization premium" found in earlier work, we find a negative effect of government ownership on returns at … that personal ties can substitute for the benefits of government ownership. The "privatization discount" is higher for … relatively high welfare payments to employees, which presumably would fall with privatization, benefit disproportionately from …
Persistent link: https://www.econbiz.de/10005774582
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A Theory of the Firm based on Partner Displacement
Hellmann, Thomas; Thiele, Veikko - National Bureau of Economic Research (NBER) - 2012
We develop a new theory of the firm where asset owners sometimes want to change partners ex-post. The model identifies a fundamental trade-off between (i) a "displacement externality" under non-integration, where a partner leaves a relationship even though the benefit is worth less than the loss...
Persistent link: https://www.econbiz.de/10010950631
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More is Less: Why Parties May Deliberately Write Incomplete Contracts
Halonen-Akatwijuka, Maija; Hart, Oliver D. - National Bureau of Economic Research (NBER) - 2013
Why are contracts incomplete? Transaction costs and bounded rationality cannot be a total explanation since states of the world are often describable, foreseeable, and yet are not mentioned in a contract. Asymmetric information theories also have limitations. We offer an explanation based on...
Persistent link: https://www.econbiz.de/10010951129
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Contracts as Reference Points
Hart, Oliver D.; Moore, John - National Bureau of Economic Research (NBER) - 2006
We argue that a contract provides a reference point for a trading relationship: more precisely, for parties' feelings of entitlement. A party's ex post performance depends on whether he gets what he is entitled to relative to outcomes permitted by the contract. A party who is shortchanged shades...
Persistent link: https://www.econbiz.de/10005084493
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Structuring Incentives Within Organizations: The Case of Accountable Care Organizations
Rebitzer, James B.; Frandsen, Brigham - National Bureau of Economic Research (NBER) - 2014
Accountable Care Organizations (ACOs) are new organizations created by the Affordable Care Act to encourage more efficient, integrated care delivery. To promote efficiency, ACOs sign contracts under which they keep a fraction of the savings from keeping costs below target provided they also...
Persistent link: https://www.econbiz.de/10010759906
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Reference Points and the Theory of the Firm
Hart, Oliver D. - National Bureau of Economic Research (NBER) - 2007
In this article I argue that it has been hard to make progress on Coase's theory of the firm agenda because of the difficulty of formalizing haggling costs. I propose an approach that tries to move things forward using the idea of aggrievement costs, and apply it to the question of whether a...
Persistent link: https://www.econbiz.de/10005710747
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Hold-up, Asset Ownership, and Reference Points
Hart, Oliver D. - National Bureau of Economic Research (NBER) - 2007
We study two parties who desire a smooth trading relationship under conditions of value and cost uncertainty. A rigid contract fixing price works well in normal times since there is nothing to argue about. However, when value or cost is exceptional, one party will hold up the other , damaging...
Persistent link: https://www.econbiz.de/10005720029