We develop a dynamic tradeoff model that incorporates both controlling-minority shareholders conflict and shareholders-debtholders conflict to examine the relationship among agency conflicts, expansion investment, capital structure, and debt renegotiation. We show that balancing the two...

The rise of intermediary-less decentralized finance (“DeFi”) lending has led many to wonder how it should be regulated. Although DeFi lending could potentially offer reduced risks of centralization and market frictions, investors in DeFi lending are currently exposed to centralized risks and...

Agency and wholesale models are widely adopted vertical contractual agreements. This paper compares the private incentives and social welfare of these two business models by highlighting the differences in move order and price structure. With a monopoly platform, the agency model dominates the...

This paper assesses the emerging regulatory framework for special purpose acquisition companies (SPACs). According to this framework, mergers of SPACs, known as de-SPACs, must be “fair” to public (or unaffiliated) SPAC shareholders, and transaction participants face heightened liability risk...

In 2021, the U.S. Supreme Court decided PennEast Pipeline Co. v. New Jersey. The case is often associated with a theory of private delegation--that is, that Congress can delegate its federal eminent domain authority to private companies to build natural gas pipeline projects on state land. But...

Theories of political accountability typically focus on voter-politician relationships. However, overall government performance depends on both elected politicians and unelected bureaucrats. Politicians are agents of voters while serving as principals to bureaucrats. We develop a model of...

Long and specific Contracts in the US and short and ambiguous contracts in Japan are a stereotypical comparison of the contracting practices in both countries. Such characteristics of written contracts are understood as sticky. Based on a semi-structured interview of Japanese auto and...

We study a contract design problem between a principal and a team of two productively heterogenous agents who can mutually monitor each other’s actions over an infinite horizon. The principal designs the explicit contract to set the stage for the agents to use implicit contracts to motivate...

In most electoral agency models, the principal observes an increasing signal of the agent's effort. But in enforcement contexts, the signal may be nonmonotonic. This is the case if the principal observes enforcement actions rather than underlying violation incidents (e.g., crime or infections)....