This paper derives the decision to found a nonprofit firm as the equilibrium outcome of a multistage game among individuals who would like a public good to be provided. The model predicts that if individuals will voluntarily contribute towards provision of the public good, then it is in the...

The interaction of insurance and the market for physician services is considered in a model where imperfectly informed consumers rely on doctors for advice on the utilization of services and there is monopolistic competition among physicians on the basis of price and the quality of their advice....