If machines are indivisible, a vintage capital model nust give rise to income inequality. If new machines are always better than old ones and if society cannot provide everyone with a new machine all of the time, inequality will result. I explore this mechanism in detail.

We model research as a signal on an unknown parameter of a technology.

We study a monetary in which final goods sell on spot markets, while labor and dividends sell through contracts. Firms and workers confuse absolute and relative price changes: A positive price-level shock makes sellers think they are producing better goods than they really are. They split this...

This a one-agent model of learning by doing and technology choice. The more the agent uses a technology, the better he learns its parameters, and the more productive he gets. This expertise is a form of human capital.

People at the top of an occupational ladder earn more partly because they have spent time on lower rungs, where they have learned something. But what precisely do they learn? There are two contrasting views: First, the "Bandit" model assumes that people are different, that experience reveals...

A new technology or product is often developed by the single entrepreneur. Whether he reaches the initial public offering stage or is acquired by a listed firm, it takes time for the innovator to add value to the stock market. Indeed, the innovation may, at first, reduce the market's value...

We study the principal-agent problem when there is nominal risk. We find that when nominal data are gathered with delay, fully indexed contracts are not time consistent, not renegociation proof.