This paper examines how strategic alliances to create and use standards affect economic growth and development. The explanation of the link from standards to economic growth and development is through the effects of standards on the incentives to perform industrial research and development...

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...

We study the problem faced by the entrepreneur seeking outside support to turn an entrepreneurial idea into a successful innovation — specifically a successful technological innovation resulting from research and development. The paper develops and tests the hypothesis that as an...

When a principal’s monitoring information is private (non-verifiable), the agent should be concerned that the principal could misrepresent the information to reduce the agent’s wage or collect a monetary penalty. Restoring credibility may lead to an extreme waste of resources—the so-called...

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...

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...

When the difficulty of a research and development problem is uncertain and the quality of the technology produced is nonverifiable, simple prize mechanisms are likely to be ineffective and inefficient. In this setting, prize administrators may want to use an incomplete contracting approach,...

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...