We study the potential conflict between cost minimization and investment in prevention for a risky venture. A natural monopoly is regulated i) for economic purposes; ii) because it can cause losses of substantial size to third parties (the environment or people). The regulator observes the production cost without being able to distinguish the initial type (an adverse selection parameter) from t...

We study the choice that a firm makes between an employment mode, in which the firm controls service provision by employing professionals, sales representatives, or other types of agents, and an agency mode, in which the firm enables agents to provide their services on terms that they control. The choice of mode is determined by the need to balance double-sided moral hazard problems arising fro...

This article lays out some of the major features of the proposed research on Catholic governance practices in a context of Polish post-communist social change. Firstly, it proposes to examine how market action in Poland was embedded in socio-normative structures infl uenced by Catholic social agency. In such a perspective, it is suggested that the attention should be paid to the role of Catholi...

Given the substantial amount of resources currently invested in microcredit programs, it is more important than ever to accurately assess the extent to which peer monitoring by borrowers faced with group liability contracts actually reduces moral hazard. We conduct a field experiment with women about to enter a group loan program in Paraguay and then gather administrative data on their repaymen...

Microfinance has been heralded as an effective way to address imperfections in credit markets. From a theoretical perspective, however, the success of microfinance contracts has puzzling elements. In particular, the group-based mechanisms often employed are vulnerable to free-riding and collusion, although they can also reduce moral hazard and improve selection. We created an experimental econo...

Is the second best outcome of static agency models renegotiation proof? In models with one period of renegotiation, Fudenberg and Tirole (1990) answer no when the principal makes the offer, while Ma (1994) and Matthews (1995) answer yes when the agent makes the offer. This paper analyzes the robustness of these two claims when there are more periods of renegotiation. With a known number of peri...

Compensation not only provides incentives to existing managers but attracts new managers to the firm. This paper examines the dual incentive and sorting effects of performance pay in a simple contracting model of endogenous participation. The main result is that sorting dampens optimal pay-performance sensitivity (PPS). This occurs because PPS beyond a nominal amount transfers unnecessary rent ...

INTRODUCTION: REFRAMING THE ISSUE OF RACE AND IMPRISONMENT .............. 1272 A. The Distinctive Features of African American Mass Incarceration .......... 1274 1. Total numbers incarcerated. . . . . . . . . . . .. .. . . . . . . . . .. . . . . . ...... .... . . . . . . .. ... . . .. . . . .......... 1274 2. Rate of incarceration . . ... ......... . . . . . ..... . . ............. . . ...... ....

s: Articles should not include an abstract. Please note that we will consider articles outside of the theme.The Residents’ Journal accepts manuscripts authored by medical students, resident physicians, and fellows; manuscripts authored by members of faculty cannot be accepted. To submit a manuscript, please visit http://mc.manuscriptcentral.com/appi-ajp, and select “Residents” in the manusc...

Despite great progress made in the theory of agglomeration in recent years, a number of gaps remain in our ability to understand why cities continue to have such attractive power in the new economy. Many of the most recent theories of agglomeration attempt to understand cities or clusters as loci of knowledge development and exchange, critical to higher levels of innovation and growth. Yet they...