Formal and informal institutions are often viewed as complements or substitutes in empirical and theoretical studies. In this article, we find no evidence of complementary or substitutive relationships in our empirical analysis of the relationship between formal and informal decentralization...

In this paper, we provide an outlook for further research on the topic of governance. We review four different approaches on the theory of the firm and discuss implications for governance, namely; nexus of contracts / agency theory, property rights / incomplete contracts, adaption, and nexus of...

We compare the effect of legal and institutional competition for the design of labor institutions in an environment characterized by holdup problems in human and physical capital. We compare autarky with the two country case, assuming that capital is perfectly mobile and labor immobile. We...

With adverse selection, diseconomies of scale associated with hierarchies may induce the implementation of a second-best technology. This occurs whenever rents to lower tiers of the hierarchy increase faster than total surplus. This is more likely with longer hierarchies. -- Adverse Selection ;...