We consider a general screening model with payoff externalities and type-dependent feasibility constraints. The principal can design contract instruments of arbitrary dimension to influence each agent's valuation of the proposed transaction, which also depends on the anticipated choice of other...

We propose a tractable framework to introduce externalities in a screening model. Agents differ in both payoff-type and influence (how strongly their actions affect others). Applications range from pricing network goods to regulating industries that create externalities. Inefficiencies arise...

This paper presents a theoretical model of two-sided markets with both positive inter-side externalities and negative intra-side externalities. It analyzes the net impact of negative intra-side externalities on platform prices, demands and profits in three scenarios: (i) monopoly platforms, (ii)...

Each agent in a market needs to supplement his skill with a particular skill of another agent to complete his project. A platform matches the agents and allows members of the same match to share their skills. A match is valuable to an agent if he is matched with any agent who possesses a skill...

Economists study various problems referred to as "market failure" - situations that, at least potentially, justify government intervention to solve them. Externalities (or "social costs") are viewed as perhaps the greatest market failure problems. The externality issue has also occasioned much...

Local resistance towards wind power is a central challenge for the energy transition, implying that legally imposed compensation schemes for nearby residents may become more prevalent in the near future. In this study, I use GIS-coded data on detached residential buildings in Sweden to simulate...

In markets where production has adverse externalities, policy makers may wish to increase welfare by imposing a cap on market entries. In this paper, we examine the implications that the cap has on the firms' investment equilibrium policy and on social welfare in the presence of market...

In markets where production has adverse externalities, policy makers may wish to increase welfare by imposing a cap on market entries. In this paper, we examine the implications that the cap has on the firms' investment equilibrium policy and on social welfare in the presence of market...

In a competitive industry where production entails a negative externality, a welfare-maximizing regulator considers, as control instruments, setting a cap on the industry output or levying an output tax. We embed this scenario within a dynamic setup where market demand is stochastic and market...

The paper presents a model of a software monopolist who benefits from a lagged network externality arising from consumers' feedback through the so-called bug-fixing effect. That is, the software producer is able to correct errors in the software code detected by previous users, improving her...