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Xiaoxi Li, Marc Quincampoix, and Jérôme Renault

vol. 36, n. 4, April 2016, pp. 2113–2132

We consider optimal control problems where the running cost of the trajectory is evaluated by a probability measure on R. As a particular case, we take the Cesàro average of the running cost over a fixed horizon. The limit of the value with Cesàro average when the horizon tends to infinity is...

Baptiste Massenot, and Stéphane Straub

vol. 54, n. 2, April 2016, pp. 1046–1067

A standard view holds that removing barriers to entry and improving judicial enforcement would reduce informality and boost investment and growth. We show, however, that this conclusion may not hold in countries with a concentrated bank- ing sector or with low financial openness. When the formal...

Roland Bénabou, and Jean Tirole

vol. 124, n. 2, April 2016, pp. 305–370

To analyze the impact of labor market competition on the structure of compensation, we embed multitasking and screening within a Hotelling framework. Competition for talent leads to an escalation of performance pay, shifting effort away from long-term investments, risk management, and cooperation....

Philippe De Donder, and John E. Roemer

vol. 18, “1”, April 2016, pp. 85–96

We study how rich shareholders use their political influence to deregulate firms that they own, thus skewing the income distribution towards themselves. Individuals differ in productivity and choose how much labor to supply. High productivity individuals also own shares in the productive sector and...

Adrien Blanchet, and Pierre Degond

vol. 163, n. 1, April 2016, pp. 41–60

We consider a finite number of particles characterised by their positions and velocities. At random times a randomly chosen particle, the follower, adopts the velocity of another particle, the leader. The follower chooses its leader according to the proximity rank of the latter with respect to the...

Christian Gollier

vol. 30, April 2016

Anna D’Annunzio, and Pierfrancesco Reverberi

vol. 40, n. 4, April 2016, pp. 353–367

Renato Gomes, Daniel Gottlieb, and Lucas Maestri

vol. 96, March 2016, pp. 145–169

Firms must strike a delicate balance between the exploitation of well-known business models and the exploration of risky, untested approaches. In this paper, we study financial contracting between an investor and a firm with private information about its returns from exploration and exploitation....

Johannes Hörner, and Larry Samuelson

vol. 45, n. 1, March 2016, pp. 89–136

We study a discrete-time model of repeated moral hazard without commitment. In every period, a principal finances a project, choosing the scale of the project and a contingent payment plan for an agent, who has the opportunity to appropriate the returns of a successful project unbeknownst the...

Mike Hoy, and Nicolas Treich

vol. 41, n. 1, March 2016