This paper investigates government subsidy games for private sector research and development (R&D) in a two-country two-firm intra-industry trade model. Two funding structures are compared: “cost sharing” vs. “reward for performance.” Both the theoretical evidence and the results of a...

The Advanced Technology Program (ATP) of the National Institute for Standards and Technology (NIST) subsidizes the R&D expenditure of large single firms at a maximum rate of 40%. The theoretical analysis herein of a monopoly innovator suggests that this subsidy rate is about socially optimal...

This paper argues that interest on consumer debt must be taken into account when measuring poverty and inequality. These interest payments cannot be used to support household living standards. This makes middle- and low-income households worse off. Recent increases in consumer debt means that...

The goal of the present paper is to explore the optimal subsidy of R&D by both the foreign and home countries in a model based on Herguera and Lutz (The World Economy, 1998). While they assume the home country subsidy is designed to help the home country "leapfrog" the foreign, we assume...

This paper extends Gretz, Highfill, and Scott, "R&D Subsidies and Multinational Firm Ownership," Global Economy Journal (2007) to include the case of exporting to one or two markets. The primary results are that exporting is welfare enhancing for the home country (whether or not the firm is...

Recent studies have compared labour gains from protection in import-competing industries with the costs of protection and found that those gains are not large enough to justify trade restraints. This study utilizes a new empirical technique for estimating the costs and benefits of protection in...

Consider an industry where a "home" and a "foreign" firm compete on the basis of both price and quality. Further, suppose cost considerations imply that potential market size is positively related to quality. This paper suggests that it is not necessarily the case that both the home and foreign...

Contract law has neither a complete descriptive theory, explaining what the law is, nor a complete normative theory, explaining what the law should be. These gaps are unsurprising given the traditional definition of contract as embracing all promises that the law will enforce. Even a theory of...