This paper proposes an explanation of merger waves based on a dynamic preemption game. A set of acquirers compete over time for scarce targets. At each point in time, an acquirer can either postpone a takeover attempt, or raid immediately. By postponing the takeover attempt, an acquirer may gain...

This work presents an equilibrium model of diversification through merger formation. Due to moral hazard problems, poorly capitalized firms are credit rationed and may seek to alleviate the incentive problem (and thereby raise external funds) by either merging, employing a monitor or a...

This paper revisits recent empirical research on buyer credulity in arts auctions and auctions for assets in general. We show that elementary results in auction theory can fully account for some stylized facts on asset returns that have been held to suggest that sellers of assets can exploit...

This paper revisits recent empirical research on buyer credulity in arts auctions and auctions for assets in general. We show that elementary results in auction theory can fully account for some stylized facts on asset returns that have been held to suggest that sellers of assets can exploit...

The present paper contributes to the literature on dynamic games with strategic complementarities, in two interrelated ways. First, we identify a class of dynamic complete information games in which intertemporal complementarities and multiple equilibria can be fruitfully analyzed. Second, we...

This paper fully characterizes the optimal control of a recurrent infectious disease through the use of (non-vaccine) prevention and treatment. The dynamic system may admit multiple steady states and the optimal policy may be path dependent. We find that an optimal path cannot end at a point...

This paper sets forth a model of contracting for delivery in an environment with time to build and adverse selection. The optimal contract is derived and characterized and it takes the form of a deadline contract. Such a contract stipulates a deadline for delivery for each possible type of agent...

Casual observation suggests that athletics records tend to cluster over time. After prolonged periods without new records, a record breaking performance spurs other athletes to increase effort and thereby repeatedly set new standards. Subsequently, record breaking subsides and the pattern...

This paper proposes an explanation of merger waves based on the interaction between competitive pressure and irreversibility of mergers in an uncertain environment. A set of acquirers compete over time for scarce targets. At each point in time, an acquirer can either postpone a takeover attempt,...

In most industries, ranging from information systems development to construction, an overwhelming proportion of projects are delayed beyond estimated completion time. This fact constitutes somewhat of a puzzle for existing theory. The present paper studies project delays and optimal contracts...