This paper presents a model of quantity regulation aimed at mitigating externalities from over-use of a commons: for example, restrictions on use of automobiles, fisheries, computer networks and electronic stock quotation systems with high-frequency traders. The model provides a...

We consider the signaling role of attorney fees which have been usually assumed as exogenous in literature. We show that there exists an equilibrium in which the informed plaintiff uses both the attorney fee and the settlement demand as signals for his damage amount. If attorney service is not...

We define a hypergraph by a set of associations which consist of nonexclusive two or more players. It is a generalization of a graph (or a network) in the sense that an association, the counterpart of a link in a hypergraph, connects any number of nodes, not simply a pair of nodes. We...

Is it better to apply effort to increase personal consumption, or control what one wants? The model presented here provides a characterization of demand for self control, namely, its responsiveness to price and risk. Unlike most other models of self control, the model does not identify self...

This paper reconsiders the problem of optimal law enforcement when the apprehension probability depends on the offense rate as well as policing expenditures. A natural consequence of such an apprehension probability is the possible multiplicity of the equilibrium due to strategic...

The emergence of Islamic Banks (IBs) with Sharia boards that restrict the set of permissible products and enforce prohibition of riba and gharar raises basic questions of how IB clients benefit by choosing financial services from a restricted menu of possibly higher-cost cash flows. Norms that...

Two consumers sequentially purchase at most one unit of some homogeneous good from a monopolist who knows the state of nature, either high or low. I characterize a rationing equilibrium at which the high-type monopolist produces only one unit and rations customers, whereas the low-type...

The author reexamines the Schmalensee effect from a dynamic perspective. Schmalsensee's argument suggesting that high quality can be signaled by high prices is based on the assumption that higher quality necessarily incurs higher production cost. In this paper, the author argues that firms...

The authors reexamine the Schmalensee effect from a dynamic perspective. Schmalsensee's argument suggesting that high quality can be signaled by high prices is based on the assumption that higher quality necessarily incurs higher production cost. In this paper, the authors argue that firms...