I study expertise acquisition in a model of trading under asymmetric information. I propose and implement a method to measure r, the ratio of the marginal social value to the marginal private value of expertise. This can be decomposed into three sufficient statistics: traders’ average profits, the fraction of bad assets among traded assets and the elasticity of good assets traded with respect t...

We investigate the manifold posed question: “To what extent does investment in human and social capital, besides the effect of “talent”, enhance entrepreneurial performance?” We distinguish between three different performance measures: survival, profits, and generated employment. On the basis of the empirical analysis of a rich Dutch longitudinal data set of firm founders, we conclude that spec...

We estimate the welfare associated with the Medicare HMO program, now known as Medicare+Choice (M+C). We find that the creation of the M+C program resulted in approximately $15.6 billion in consumer surplus and $52 billion in profits from 1993 to 2000 (in 2000 dollars). This program most likely generated significant net social welfare. However, we find that consumer surplus is geographically un...