One interesting organizational strategy in the marketplace is a reallocation of control rights in an organization's hierarchy system. When facing certain kinds of internal or external challenges, organizations are sometimes observed to reallocate certain control rights horizontally or...

Staged financing is a popular financing strategy in corporate finance. However, depending on the type of financial instrument used to carry out the financing strategy, staged financing has many potential problems. This paper shows that certain types of convertibles can be deployed to resolve the...

It is well known that there are infinitely many incentive contracts that achieve the full information outcome in the standard agency model when the agent is risk-neutral. However, since Harris and Raviv (1979), the fixed-rent contract has been the focal point among those infinitely many...

This paper investigates staged financing in an environment where an entrepreneur faces an imperfect capital market and an investor faces moral hazard and uncertainty. Staged financing plays two roles in this model: to control risk and to mitigate moral hazard. Using parametric functions and...

This paper studies the characteristics of optimal contracts when the agent is risk-averse in the double moral-hazard situation in which the principal also participates in the production process. It is already known that a simple linear contract is one of many optimal contracts under the double...

A long-standing deterrent to foreign direct investment in developing countries is weak enforcement of binding contracts. A local firm may learn business skills from a cooperating multinational firm and subsequently do business on its own based on the acquired skills. In a two-period...

This paper investigates the high-tech bubble in the late 1990s. We intend to identify possible causes and factors that lead to its formation. Using a large sample of 39,673 firm-level observations covering a wide range of firms, we find a positive relationship between venture capital investment...

A long-standing deterrent to foreign direct investment in developing countries is weak enforcement of binding contracts. A local firm may learn business skills from a cooperating multinational firm and subsequently do business on its own based on the acquired skills. In a two-period...

This paper studies the characteristics of optimal contracts when the agent is risk-averse in the double moral-hazard situation in which the principal also participates in the production process. It is already known that a simple linear contract is one of many optimal contracts under the double...

This paper develops a simple structural model of the boundaries of the firm to formalize some of the aspects of the Williamsonian transaction cost economics that are distinct from Grossman, Hart and Moore's formal property rights theory. We build on two ideas. First, we employ Williamson's idea...