This paper develops the theory of a U relation between seller concentration and R&D investment and integrates the new theory with the traditional expectation of an inverted-U relation. The paper illustrates the U relation, and the integrated U and inverted-U relations, for a single type of R&D...

When the information used by a principal to monitor an agent is private, and thus non-verifiable by a third party, the principal has a credibility issue with the agent. The agent should be concerned that the principal could misrepresent the information in order to collect a monetary penalty from...

Directly subsidizing bank deposits increases franchise value and promotes prudent lending. Subsidization can be made budget-neutral for the regulator by requiring banks to make upfront payments equal to the capitalized value of future subsidies they stand to receive. While compensating the...

The paper considers a principal-supervisor-agent hierarchy where the supervisor is self-interested and able to manipulate information. The supervisor's self interest may motivate him to accept a bribe in exchange for a report that is overly favorable to the agent or to extort the agent by...

This paper suggests two mechanisms by which a progressive distribution of tax burdens may promote economic efficiency. First, a progressive tax rate structure indexed to the median income may discourage rent seeking by powerful interest groups. Second, progressive taxation favors income streams...