We study the number, size, and location of a firm's plants. The firm's decision balances the benefit of delivering goods and services to customers using multiple plants with the cost of setting up and managing these plants, and the potential for cannibalization that arises as their number...

A prominent feature of the Kiyotaki–Wright model of commodity money is multiplicity of dynamic equilibria. We show that the extent of multiplicity hinges on the frequency of search. Holding fixed the average number of meetings over time, we vary search frequency by altering the interval...

A prominent feature of the Kiyotaki and Wright (1989) model of commodity money is the multiplicity of dynamic equilibria. We show that the frequency of search is strongly related to the extent of multiplicity. To isolate the role of frequency of search in generating multiplicity, we (i) vary the...

Option value arises in environments where an investment needs to be made under uncertainty. The decision to invest in postsecondary education is a perfect example. Students, as they learn about the uncertain educational outcomes, can drop out or transfer up to harder and more rewarding schools...

We present a dynamic model of college education where the students face uncertainty about their income stream after graduation due to unobserved heterogeneity in their innate scholastic ability. As students write exams, they reevaluate their expectations and may find it optimal to drop out and...

We provide an analytical characterization of the optimal anticipated monetary policy in an economy where agents have a precautionary savings motive due to random production opportunities and the presence of borrowing constraints. Non storable production makes intrinsically useless outside money...

We study a model of firm price setting with customer markets and empirically evaluate its predictions. Our framework captures the dynamics of customers in response to a change in the price set by firms, describes the behavior of optimal prices in the presence of customer retention concerns, and...