This article focuses on the regulation problems raised by two specific characteristics of research and development: first, it is normally desirable that several units pursue the same goal, and second, that only the best of the final products made by these units is worthwhile to society. When...

In this article I identify a type of integration cost that is associated with agency relations within the firm. This cost arises when the firm's principal cannot fully commit to long-term contracts with the firm's agents, and these agents have private information. In the model, integration can...