We develop a model for pricing expropriation risk in natural resource projects, in particular an oil field. The government is viewed as holding an American-style option to expropriate the oil field, but facing the following three possible expropriation costs: A state-run company may produce oil less cost-efficiently than a private firm, the government may have to pay a compensation to the firm,...

Institutions that fail to protect citizens against expropriation from the government hinder investment and economic development. How do economic agents counteract these institutions? I propose a theory of companies establishing connections with politicians as a mechanism to protect property rights and increase investment. I build a model in which N companies face a sector-level threat of exprop...

In this paper, we investigate technical methods to deal with exceptions, inconsistencies, and ambiguity. Existing reason maintenance systems are only suitable for some of these problems. Doyle's TMS handles exceptions properly, but gets in trouble with non-monotonic odd or even loops. On the other hand, de Kleer's ATMS produces too many contexts if there are exceptions of exceptions. Therefore,...