We consider multi-stage elimination contests, where agents efforts at different stages generate some output for the organizers. Depending on the output function we characterize the optimal prize structure of the tournament and show that it is almost efficient. We have found that in some cases...

We consider multi-stage elimination contests where agents' efforts at different stages generate some output for the principal. Depending on the output function various prize structures can be optimal. If the output function depends much more on efforts applied at later stages than on those...

We investigate observed rent dissipation-the ratio of the total costs of rent seeking to the monetary value of the rent-in winner-take-all and share contests, where preferences are more general than usually assumed in the literature. With concave valuation of the rent, we find that contests can...

This overview of transaction cost economics is organized around the "Carnegie Triple" – be disciplined; be interdisciplinary; have an active mind. The first of these urges those who would open up the black box of economic organization to do so in a modest, slow, molecular, definitive way,...

This article develops a new rationale for the emergence of pay-for-performance contracts where the labor market is competitive, workers are risk averse, and firms are risk neutral and unaware of workers' productivities. The article shows that the prevalence of pay for performance rises and the...

This article summarizes and draws connections among diverse streams of theoretical and empirical research on the economics of privacy. We focus on the economic value and consequences of protecting and disclosing personal information, and on consumers' understanding and decisions regarding the...

As data becomes increasingly valuable, firms face financial pressures to capture that data and extract its value. Consumers, on the other hand, have reason to fear that such data might not be used in their best interests. How can a firm capture data, respect consumer privacy, and create value...

Online service platforms that enable customers to connect with a large population of independent servers have been successfully developed in many sectors, including transportation, lodging, and delivery, among others. We ask a basic, yet fundamentally important, question - who should set the...

What assets does a firm need to hold to develop a profitable business model? A ‘Hart asset’ is an asset that a firm cannot strategically afford a rival firm to own or control due to the risk of hold up, and therefore must be held within the firm, and upon which a profitable business model...

This paper asks whether it is optimal for a firm to pay a loss averse agent for losses due to demotion and reassignment caused by a bad fit on an assignment, in a hidden action setting. We find that it is optimal for the firm to fully pay the agent for such losses with a targeted contingent...