We develop a theory of a firm in an environment with incomplete contracts. The firm's headquarter decides on the complexity, the organization, and the global scale of its production process. Specifically, it decides: i) on the mass of symmetric intermediate inputs that are part of the value...

We develop a theory of a firm in an incomplete contracts environment which decides on its complexity, organization, and global scale. Specifically, the firm decides i) how thinly it wants to slice its production process by choosing the mass of symmetric intermediate inputs that are...

In 2007 Swiss RE was striving to maximize economic value, a metric that would allow the company to assess its performance over time despite the volatility of the reinsurance industry. Maximizing economic value required that decision makers throughout the company understood the risk profiles of...