Employment contracts give a principal the authority to decide flexibly which task his agent should execute. However, there is a tradeoff, first pointed out by Simon (1951), between flexibility and employer moral hazard. An employment contract allows the principal to adjust the task quickly to...

We propose a sectoral-shift theory of aggregate factor productivity for a class of economies with AK technologies, limited loan enforcement, a constant production possibilities frontier, and finitely many sectors producing the same good. Both the growth rate and total factor productivity in...

This paper presents a theoretical framework to describe the behaviour of the credit rating agencies(CRAs) during the crisis, surveying some reputational game models. CRAs have been blamed of inflating ratings of the new credit risk transfer products (CRTs) and of acting in favour of issuers...

This paper incorporates learning and reputation building into a simple dynamic stochastic model of international trade with asymmetric information. We use the model to study a bilateral trade flow influenced significantly by learning and reputation, namely U.S. imports of Japanese cars over the...

Employment contracts give a principal the authority to decide flexibly which task his agent should execute. However, there is a tradeoff, first pointed out by Simon (1951), between flexibility and employer moral hazard. An employment contract allows the principal to adjust the task quickly to...

People are interacting more with strangers thanks to recent technological advancement in online platforms. Online interactions can be characterized by infinitely-repeated games. Recent studies have shown that institutions that make people’s decisions open to others may enhance cooperation in...

Reputation systems aim to induce honest behavior in online trade by providing information about past conduct of users. Online reputation, however, is not directly connected to a person, but only to the virtual identity of that person. Users can therefore shed a negative reputation by creating a...

This paper uses data collected from eBay's website to identify why buyers fail to leave (negative) feedback in online markets. Empirical results con¯rm that the fear of retaliation may be an important motivation for buyers not to leave (negative) feedback, while the time and effort cost of...

What is the influence of syndicate organization on the duration of loan arrangement? I answer this question using the survival analysis methodology on a sample of loans from 59 countries over the 1992-2006 period. I find that syndicate size, concentration, reputation, and national diversity...

Within the field of social capital study, concerns have been expressed that deviations from a fundamental understanding that social capital is captured from embedded resources in social networks may reduce the intellectual enterprise to a catch all fad (Lin, Cook, Burt, 1999). This paper is an...