Innovation is important for firm performance and broader economic growth. But breakthrough innovations necessarily require greater risk-taking than more incremental approaches. To understand how managers respond to uncertainty when making research and development decisions, we conducted three...

The Coase Theorem is analyzed in a setting in which pollution damages are a stochastic function of emissions and of natural environmental variability (e.g., weather). When pollution damages are stochastic, emissions create financial risks. Pollution levels allowed under Coasian contracts then in...

Innovation is important for firm performance and broader economic growth. But breakthrough innovations necessarily require greater risk-taking than more incremental approaches. To understand how managers respond to uncertainty when making research and development decisions, we conducted three...

The Coase Theorem is analyzed in a setting in which pollution damages are a stochastic function of emissions and of natural environmental variability (e.g., weather). When pollution damages are stochastic, emissions create financial risks. Pollution levels allowed under Coasean contracts then in...