This paper analyzes a model in which a firm's compliance with regulation is monitored by a supervisor. The supervisor exerts costly, unobservable effort to raise his inspection intensity, which leads to moral hazard. A non-compliant firm may exert effort in avoidance to reduce the probability of...

This paper examines optimal fines in a regulatory framework where the regulator can choose either surprise or announced inspections to monitor a firm for compliance. The firm can invest in detection avoidance, but it receives a fine if the regulator discovers that it is non-compliant. In the...

In this paper, we develop a theoretical model of university licensing to explain why university license contracts often include payment types that differ from the fixed fees and royalties typically examined by economists. Our findings suggest that milestone payments and annual payments are...