In the first chapter, I analyze the US banking industry in order to explain two facts. First, larger banks have lower but less volatile returns on loans compared to smaller banks over the years. Second, larger borrowers have better financial records, i.e. verifiable "hard" information, and they...

This dissertation consists of three essays that apply both economic theory and econometric methods to understand design and dynamics of institutions. In particular, it studies how institutions aggregate information and deal with uncertainty and attempts to derive implications for optimal...

"In the future data communication networks interoperability becomes critical from both technological and business strategy perspective. Significance of interoperability has to be evaluated in terms of the overall economic performance of the system. In this paper we will present our view of the...

We solve the problem of optimal securitization for an issuer facing heterogeneous investorswith arbitrary time and risk preferences. We show that the optimal securitizationis characterized by multiple nonlinear tranches, and each investor gets a portfolio of thesetranches. In particular, when...

This dissertation explores several aspects of the theory in industrial organization.The first chapter builds a model with two cost asymmetric firms who not only have Cournot competition in the spot market but also have the opportunity to trade forward contracts. It is shown that with forward...

This dissertation looks at several issues in designing an optimal skill-basedconsumer contest (SBCC). Consumer product (or service) companies, such asonline entertainment providers, often use SBCCs to promote the consumption oftheir products (or services). The main objective of a SBCC is to...