This article models the problem of designing predation policy as one of structuring incentives so that firms choose not to practice predation but to engage in nonpredatory competition. The government decides how intensively to search for possible predatory incidents, how thoroughly to...

In this article we analyze an informed firm's choice of financial structure when the financing contract is observed not only by the capital market but also by a second uninformed party, such as a competing firm. The informed firm's gross profit is endogenous, because the second party's action...

This article analyzes the effect of product-market competition on managerial incentives. In contrast to Hart (1983a), I show that competition may actually exacerbate the incentive problem. The difference in results derives from our different assumptions about managerial preferences. The...

We use city-level data to analyze the relationship between homeowner borrowing patterns and house-price dynamics. Our principal finding is that in cities where a greater fraction of homeowners are highly leveraged-- i.e., have high loan-to-value ratios--house prices react more sensitively to...

I develop a model in which information problems make it difficult for banks to raise funds with instruments other than insured deposits. The model has a number of implications for bank asset and liability management as well as corporate financing patterns. It also speaks to the question of how...

We develop a model that clarifies the respective advantages and disadvantages of academic and private-sector research. Rather than relying on lack of appropriability or spillovers to generate a rationale for academic research, we emphasize control-rights considerations, and argue that the...