A theory is proposed where the pay policy and size of established firms are determined together with individual workers' entrepreneurship decision. The main results are twofold. First, taking the firm size as given, larger firms tend to have less flexible wages and produce entrepreneurs of...

We study how complementarities and intellectual property rights affect the management of knowledge workers. The main results relay when a firm will wish to sue workers that leave with innovative ideas, and the effects of complementary assets on wages and on worker initiative. We argue that firms...

The Porter hypothesis predicts that the win-win goals of environmental improvement and economic performance can be achieved though technological innovation, but it remains to be tested in elaborated ways. Explicitly identifying the role of environmental regulation and finely clarifying the scope...