We study contests where, subject only to a capacity constraint on mean performance, contestants compete for identical prizes by choosing random performance levels. The capacity constraint combined with the rank-contingent rewards makes winsmall/lose-big strategies optimal. Equilibrium strategies...

This paper develops a theory of governance and inheritance within family firms based on kin altruism (Hamilton, 64). Family members weigh the payoffs to relatives in proportion to relatedness. The theory shows that family management entails both costs and benefits. The attenuated monitoring...

This paper considers lending to finance projects in a setting where repayment enforcement appears impossible. The loan was illegal and thus legally unenforceable. Creditors were incapable of applying private coercion to force repayment. Borrowers lacked both collateral and reputation capital....