The corporate finance literature suggests that a financially constrained firm invests less than an identical unconstrained firm. This does not imply that financial frictions cause firms to invest less than they would in a frictionless economy. When firms compete for investment funds, an increase...

The purpose of the current paper is to extend the theory of regional public goods to account for population congestion,or crowding, and then to introduce the possibility of congestion into boundary spillovers of benefits. This paper deals with congestion costs for regional public goods provided...

We establish a general preference for price uncertainty by the price taking, risk neutral, nonrenewable resource extracting firm with orthodox convex extraction costs. Option prices for delivery of a ton at a particular date in the future exceed the expected dollar return from the purchase of...

Considerable attention has been focused on the relationship between transportation costs and land values in urban areas, but little research has been conducted on the other factors that affect land values. The study in this paper should concentrate on any one of a number of different types of...

Dynamic inconsistency provides a theoretical basis for discussions of policy credibility: when the government cannot commit its future policies, the incentive to deviate from the 'optimal' plan renders it incredible. We derive the best policy in the absence of precommitment as the feedback Nash...

A spatial model of cities is constructed by combining interaction costs between firms with indivisibility in production. The optimal allocation requires Pigouvian subsidies to firms and the externality version of the Henry George Theorem is obtained: at the optimal city size, the total Pigouvian...

Clearly there are many aggregate factors which affect all firms in the economy to some degree. Presumably there are others which differentially affect individual industries. Industry considerations aside, any particular firm would want to formulate 'own-firm' expectations incorporating aggregate...

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The effect of an economy's growth on its balance of payments has been a subject which has received a good deal of attention in the recent literature in international economics. Much of this attention derives from general dissatisfaction with the theoretical and empirical aspects of the standard...

This paper develops a simple two-country model of illegal immigration to examine the interaction among migrant labour, unemployment rates, and spending by the host country on enforcement. The analysis focusses on the dynamics of immigration policy and its role in determining the mechanism by...