I introduce a Bayesian-learning model of the firm to account for a variety of empirical facts about firms. The many tasks the firm can undertake (the scope of the firm) are informationally related, so that the firm can enjoy some economies of scope from information. The model predicts changes in...

We study relational contracts in a firm-worker relationship with mutual uncertainty about match quality. The worker's actions are publicly observed and generate output, and hence information about the match quality. Despite the absence of private information, uncertainty about match quality...

This chapter reviews the theoretical and empirical literature on learning by doing. Many of the distinctive theoretical implications of learning by doing have been derived under the assumption that the cost–quantity relationships observed in numerous empirical studies are largely the result of...