This paper analyses a model of R&D where the product quality is imperfectly observed by customers. We consider different types of customer monitoring and characterise the equilibrium levels of investment and the resulting reputational dynamics.

If the firm does not know its own quality, we show that the firm stops investing when its reputation gets close to the exit threshold and its life-expectancy vanishes. If the firm knows its own quality, to the contrary, we show that the firm optimally invests until its reputation falls to the...

We analyze a large, anonymous labour market in which firms motivate their workers via relational contracts. The market is frictionless and features on-the-job search, in that all acceptable vacancies are immediately filled and the employed compete with the unemployed for vacancies. While firms...

In a range of settings, private firms manage peer effects by sorting agents into different groups, be they schools, communities, or product categories. This paper considers such a firm, which controls group entry by setting a series of anonymous prices. We show that private provision...

This paper solves for the profit-maximizing strategy of a durable-goods monopolist when incoming demand varies over time. We first characterize the consumers' optimal purchasing decision by a cut-off rule. We then show that, under a monotonicity condition, the profit-maximizing cut-offs can be...

In a range of settings, private firms manage peer effects by sorting agents into different groups, be they schools, neighbourhoods or teams. This paper considers such a firm, which controls group entry by setting a series of anonymous prices. We show that private provision systematically leads...

This paper characterizes the optimal contract for a principal who repeatedly chooses among N potential agents under the threat of holdup. Over time, the principal would like to trade with different agents; however, the possibility of ex-post opportunism allows agents to collect rents and creates...