Sellers auctioning items use advertisements and location to generate interest. They seek a rightward shift in the ex-ante distribution of bidder valuations. We characterize distribution pairs such that all more-is-better expected utility maximizing sellers in preference-revealing auctions prefer...

Model invariances have been used extensively to understand welfare and conduct consequences of firm heterogeneity in a one-product Cournot oligopoly. Nothing is known about the richer and more realistic context of firm heterogeneity in multi-product Cournot oligopoly. In this note, welfare in a...

Here we consider the hedging roles of a price futures contract versus a revenue futures contract. In the absence of idiosyncratic output risk, the revenue contract almost always dominates the price contract. Idiosyncratic output risk provides conditions under which the price contract should...

Suppose a farmer had to apply a herbicide pre-emergence or not at all. The advent of a herbicide-tolerance trait innovation then provides the option to wait for more information before making a state-contingent post-emergence application. This option to wait can increase or decrease average...

Pollution permit regulations introduce nonlinearities into the objective function of a polluting firm. We develop a microeconomic model to show the effects these nonlinearities might have upon firm decisions when emissions are stochastic. Under perfect competition the fraction of planned...

Agricultural production, especially hog production, is undergoing brisk reorganization. Production and marketing contracts are attenuating the control and property rights of growers. In seeking reasons for the restructuring, this paper surveys the opinions of industry participants. It then...

In a risk-neutral stochastic environment where bankruptcy is possible, it is well-established that coinsurance incentives may lead creditors to prefer mergers over spin-offs, while shareholders may prefer spin-offs. This paper shows that there are two distinct reasons for this. One is due to the...

When choosing production capacity, a firm may not know which among mutually exclusive projects will be most profitable. It may be possible to await more information before committing given capacity to a project. We identify when shifts in project profitability and firm pecking order increase ex...

Diversification, a central issue in the study of capital allocation, has much to do with symmetries and asymmetries in the distribution of asset returns. A diversified portfolio imposes symmetry on the allocation vector in order to balance out much of the asymmetries in the returns vector. Using...

When nonpoint source pollution is stochastic and the damage function is convex, intuition might suggest it is more important to control a nonpoint pollution source than a point source. Earlier research has provided sufficient conditions such that the permit price for a unit of ex-ante expected...