Both private and public organizations constantly grapple with incentive schemes to induce maximum effort from agents. We begin with a theoretical exploration of optimal contest design, focusing on the number of competitors. Our theory reveals a critical link between the distribution of luck and...

Is the degree of external economies (at the industry level) higher than the degree of internal increasing returns (at the firm level)? If so, what is the exact source of this difference? In the general equilibrium model in which firms producing final goods choose the degree of specialization of...

This paper studies a general equilibrium model of rural-urban migration in which manufacturing firms engage in oligopolistic competition and choose increasing returns technologies to maximize profits. Urban residents incur commuting costs to work in the Central Business District. Surprisingly a...

The impact of international trade is studied in a general equilibrium model in which firms engage in oligopolistic competition and linkage effects are present. Results are derived analytically. If countries have the same technologies and the same labor endowment, core-periphery pattern arises...

The Confucian school emphasizes family value, moral persuasions, and personal relations. Under Confucianism, there is a free-rider issue in the provision of efforts. Since national officials are chosen through personal relations, they may not be the most capable. The Legalist school emphasizes...

In this general equilibrium model, banks and manufacturing firms engage in oligopolistic competition. A more advanced manufacturing technology has a higher fixed cost but a lower marginal cost of production. We show that manufacturing firms located in a country with a more efficient financial...

The impact of financial integration and product market integration is studied in a general equilibrium model with increasing returns in both the manufacturing sector and the financial sector. Firms engage in oligopolistic competition. An increase of the degree of competition in the financial...

"The role of population growth in the process of industrialization is studied in a general equilibrium model. It provides a formal presentation of Rostow's insight of the role of a leading sector in industrialization. Population growth may lead to a shortage of food and a breakdown of the...