The determination of interconnection charges is the key to the introduction of competition in telecommunications, electricity, gas, postal services, and several other industries. The paper first recaps standard regulatory policies for interconnection. It then provides a simple account of...

More then just a textbook, A Theory of Incentives in Procurement and Regulation will guide economists' research on regulation for years to come. It makes a difficult and large literature of the new regulatory economics accessible to the average graduate student, while offering insights into the...

This paper first studies how cost padding, auditing and collusion with auditors affect the power of incentive schemes in procurement and regulation. Unaudited cost padding requires fixed price contracts. Incentive schemes are more powerful under imperfect auditing than under perfect auditing and...

We develop progressively models enabling us to characterize optimal contracts between government and firms when uncertainty and various types of asymmetric information (moral hazard and adverse selection) are present. We obtain normative contracts which are close to commonly used contracts with...

This paper formalizes and studies the argument of cartelization of industries through captured agencies. An agency can affect entry by a producer of a differentiated commodity in the market of a regulated natural monopoly through the manipulation of information it produces about the benefit of...