Consider a model with two types of jobs. The profitability of promoting a worker to a fast-track job depends not only on his or her observable talent, but also on incontractible effort. We investigate whether self-fulfilling expectations may lead to a women meeting tougher promotion standards...

In non-cooperative models of the family, improved productivity in contribution to a family good typically implies that, in equilibrium, one contributes more to the public good, while one's spouse contributes less. Thus, improves contribution productivity has a negative strategic effect on one's...

In non-cooperative family models, being good at contributing to family public good like household production may reduce one's utility, since it tends to crowd out contributions from one's spouse. Similar effects also arise in cooperative models with non-cooperative threat point: improved...

Consider an auction in which potential bidders must sink an entry investment before learning their values. Suppose the auction designer can make the bidders learn their value before entry. Such early information will induce screening of high-value bidders, and it will give rise to information...

When a government cannot commit to future policies, investors face the risk of opportunistic behavior in addition to uncertain market conditions. We show that although reducing market uncertainty is sometimes essential for investment, it may aggravate problems of opportunism.

It is well-known that switching costs may facilitate monopoly pricing in a market with price competition between two suppliers of a homogenous good, provided the switching cost is above some critical level. With heterogeneous consumers monopoly pricing entails second degree price dierentiotation...

Should the government procure equipment for its agencies or let them run their own procurment auctions? Suppose the agency has private information about product quality, but is inclined to favour local suppliers. Decentralization saves bureaucracy and "agency costs", but leads to biased...

Regulated firms are not necessarily willing to invest in cost minimizing technologies, but evaluate different technologies according to their impact on the information rent. In a two-type adverse selection model three kinds of investments are considered: investments that increase the probability...

In procurement auctions with a fixed number of bidders there is a tradeoff between cost efficiency and rent extraction. An optimal mechanism, therefore, entails distortions of effort. If potential suppliers must sink an entry investment before they can participate in the auction, then decreasing...