This paper examines the demand for on-board computers in trucking, distinguishing between their incentive- and resource-allocation-improving capabilities. I find that monitoring's incentive benefits are high when perquisite-taking is attractive to drivers, driver effort is important, and...

We investigate how contractual incompleteness affects asset ownership in trucking by examining cross-sectional patterns in truck ownership and how truck ownership has changed with the diffusion of on-board computers (OBCs). We find that driver ownership of trucks is greater for long than short...

We investigate how the contractibility of actions affecting the value of an asset affects asset ownership. We examine this by testing how on-board computer (OBC) adoption affects truck ownership. We develop and test the proposition that adoption should lead to less ownership by drivers,...

This paper exploits empirically a key insight from Lucas (1978) and Rosen (1982): that the organization of production and the distribution of earnings across individuals are jointly determined by the equilibrium assignment of individuals to firms and hierarchical positions. We study how...

Moral hazard arises in "diagnosis-cure" markets such as auto repair and health care when sellers have an incentive to misrepresent a buyer's condition in order to increase demand for the treatments they supply. This article examines the market for California vehicle emission inspections. Using...