This article examines empirically the hypothesis that incomplete contracts and resulting opportunistic behavior over the return to sunk assets reduces investment. Union-firm contracts are incomplete because they (1) do not prevent all actions aimed at changing the existing contract; (2) cover a...

This paper analyzes the relationship between changes in unionization and firm growth. Average growth is significantly low er in manufacturing firms that experience successful union elections bu t these strong "effects" are largely illusory. The authors find no evidence of a significant...

This article examines the impact of unemployment insurance on the allocation of labor across industries. An overlooked aspect of unemployment insurance is the effect of imperfect experience rating on hiring. Firms in more stable industries generally pay more into the unemployment insurance...

A market composed of pairwise trading under incomplete information is modeled in order to analyze how resources are allocated among competing uses when information about trade gains is incomplete. Contrary to the results from studying a single such trade, sufficient homogeneity across potential...

We analyze the changes the National Collegiate Athletic Association (NCAA), a widely studied cartel, made in 2002 to the organizational structure of its most valuable asset, the Division I men’s basketball tournament. The NCAA granted itself more freedom in assigning participating teams to...

The authors estimate the short-run and life-cycle effects of unplanned children on unwed mothers by comparing unmarried women who first gave birth to twins with unwed mothers who bore singletons. They find large short-term effects of unplanned births on labor-force participation, poverty, and...

Self-employment rates and incomes differ significantly by race. The authors show that these differentials arise in markets with consumer discrimination and incomplete information about the price of the good and the race of the seller. Equilibrium income distributions have two properties: mean...