The number of firm bankruptcies is surprisingly low in economies with poor institutions. We study a model of bank … institutions must improve significantly in order to yield a stable equilibrium in which the optimal number of firms is liquidated …. However, in a particular range, improving institutions may even decrease the number of bad firms liquidated. …

occupation it may harm some workers while benefitting others; and it may either reduce or increase the proportion of knowledge … workers in employment. In my model, knowledge (in a broad sense) is an input into the production function of human capital …-quality one. People differ in their exogenous ability and ability is complementary with the quality of the knowledge input in the …