Although the price system is conventionally praised as an efficient way of transmitting the
information required to arrive at a Pareto optimal allocation of resources, the context in which …

It is commonly thought that a widely held corporation that is not being run in the interest of
its shareholders will be vulnerable to a takeover bid. We show that this is false, since …

Our theory of costly contracts emphasizes the contractual rights can by of two types: specific
rights and residual rights. When it is costly to list all specific rights over assets in the contract, …

If competitive equilibrium is defined as a situation in which prices are such that all arbitrage
profits are eliminated, is it possible that a competitive economy always be in equilibrium? …

This paper investigates the relationship between aggregate stock market trading volume
and the serial correlation of daily stock returns. For both stock indexes and individual large …

Market liquidity is modeled as being determined by the demand and supply of immediacy.
Exogenous liquidity events coupled with the risk of delayed trade create a demand for …

We analyze an infinite stage, alternating offer bargaining game in which the buyer knows the
gains from trade but the seller does not. Under weak assumptions the game has a unique …

THE RECENT LITERATURE on firm behavior has been characterized by two contrasting
strands of analysis: on the one hand, there is the literature attempting to extend the …

Most analyses of the principal-agent problem assume that the principal chooses an incentive
scheme to maximize expected utility subject to the agent’s utility being at a stationary point. …

A fundamental role of competition is to facilitate the allocation of resources. This is achieved
by prices which, to some extent, reflect and transmit the underlying worth of resources. The …