We study regulation of the auditing profession in a model where audit quality is unobservable and enforcing regulation is costly. The optimal audit standard falls short of the first-best audit quality, and is increasing in the riskiness of firms and in the amount of funding they seek. The model...

Despite the advances in New Institutional Economics about the economic consequences of institutions and legal rules, up to now we have only limited knowledge about the mechanisms of the evolution of law. By combining the main ideas of Evolutionary Economics and New Institutional Economics this...

This paper proposes an intertemporal model of venture capital investment with screening and advising where the venture capitalist's time endowment is the scarce input factor. Screening improves the selection of firms receiving finance, advising allows firms to develop a marketable product, both...

This article explores the wide range of roles that consultants can play to either enable or hinder organizational learning processes. A core concept in this analysis is the achievement of an appropriate marginality of the consultants’ role, in order to allow the organizational members to...

Consulting firms (CFs) sell services on a project basis to many clients and must therefore continuously tender for new contracts. One frequently used strategy by CFs is to visit the clients in connection to the tenders. The reason to the visits is either: 1) to influence the client in his...

Die sich häufenden Bilanzskandale, Korruptionsaffären und hohen Abfindungszahlungen für ausscheidende Top-Manager in den vergangenen Jahren haben auch die jeweils involvierten Beratungsgesellschaften mit ins Zwielicht gezogen. Vor diesem Hintergrund untersucht der folgende Beitrag, welche...

We consider a start-up firm which applies for a bank loan to implement a project based on complementary activities. The firm has the possibility to improve the complementarity effect by coordinating the activities. Coordination is costly and can be made either by using internal human resources...