Predatory pricing . a deliberate strategy of pricing aggressively in order to eliminate competitors . is one of the more contentious areas of antitrust policy. This paper uses a modern industry dynamics framework to characterize predatory pricing by isolating a Firm’s equilibrium predatory...

We bring together the theories of duality and dynamic programming. We show that the dual of an additively separable dynamic optimization problem can be recursively decomposed using summaries of past Lagrange multipliers as state variables. Analogous to the Bellman decomposition of the primal...

This paper models flows of foreign direct investment (FDI) in a two country, two sector DSGE framework. The allocation of capital to production capacity abroad is subject to a search-and-matching friction with endogenous capital reallocation. The model is calibrated on observed inflows and...

Building a model with three imperfect markets - goods, labor and credit - representing a product’s life-cycle, we find that goods market frictions drastically change the qualitative and quantitative dynamics of labor market variables. The calibrated model leads to a significant reduction in...

The flow profits from labor drive, to a large extent, the business cycle of job creation in the Mortensen-Pissarides model of search unemployment. In a world driven by shocks to productivity, one calibration strategy to obtain very large amplification is to assume firms make very small economic...

Controlled choice over public schools attempts giving options to parents while maintaining diversity, often enforced by setting feasibility constraints with hard upper and lower bounds for each student type. We demonstrate that there might not exist assignments that satisfy standard fairness and...