This paper presents a simple model to analyse the impact of localised externalities on the internationalisation decision of firms. We argue that, once localised spillovers are taken into account, the standard predictions on the nature and direction of foreign direct investment (FDI) flows may...

The article re-examines the proposition, first formulated by Bryant (1980) and Diamond and Dybcvig ( 1983), that in a production economy with stochastic liquidity shocks to the household sector, banks serve to provide optimal intertemporal insurance to consumers. The paper argues that in order...

The paper studies managerial compensation schemes for suituations, where the current management knows more about the company's expected profitability than the new employee. When a manager is offered a contract with only a low fixed salary but high profit participation, he will be afraid that the...

This paper is about freedom of choice and rigidity of choice rules as incentive devices. We study the optimal design of an agent's freedom of choice when his information is endogenous and costly to acquire. We show that curtailing the agent's authority over decision-making may be optimal even if...

L'étude de l'évolution de la distribution des salaires sous forme d'analyse de coupes transversales peut manquer de documenter des faits liés à la mobilité salariale de certains groupes de travailleurs. Ce travail, basé sur une étude en panel, vise à relativiser la stabilité de la...

Trying to ascertain scientifically the existence and importance of gender-based salary discrimination runs into conceptual and technical difficulties, the implications of which are not always fully appreciated: depending on the approach used, our analysis of a large sample for Switzerland in...

This paper studies optimal financial contracts and product market competition under a strategic transparency decision. When firms seeking outside finance resort to actively monitored debt in order to commit against opportunistic behaviour, the dominant lender can influence corporate...