The main hypothesis of the paper is that balance-of-payments policies, geared toward exchange rate regimes and capital account openness, influence output growth through two channels: 1. Directly, through their effect on the trade and financial sectors, and 2. Indirectly, through their impact on the probability of a balance-of-payments crisis. The empirical analysis demonstrates that the balance...

In this paper, we develop an agency-theoretic extension of the Lucas asset pricing model and examine the resulting asset price dynamics. In the model, an agent of the firm can expand or contract the firm’s output and dividend payments in response to exogenous shocks, although expansions become increasingly costly for the agent to maintain. Analysis of numerical simulations shows that the time-s...

Gender Pay Gaps among Highly Educated Professionals: Compensation Components Do Matter Making use of panel data from a survey of highly educated professionals, gender pay gaps are explored with regard to total compensation as well as to individual compensation components. The results indicate meaningful male-female wage differentials for this quite homogeneous group of people working in one spe...

This paper explores optimal ways for a firm to sell its initial public offering (IPO) to a mix of informed and uninformed investors through an intermediary. I argue that uninformed investors provide a benchmark for informed investors, resulting in an endogenous constraint that affects the issuer’s revenue. I conclude that higher revenues are achieved with higher numbers of uninformed investors ...

I add to the empirical literature on vertical contracting and wholesaler conduct by using retailer entry conditions to infer unobserved choice variables and equilibrium responses to prices and advertising. After estimating the US demand for theatrical motion pictures from 1990–96, I apply these techniques to compare observed outcomes to predictions under various distributorconduct hypotheses. W...

We propose an alternative market design to the current credit ratings industrial organization. An issuer delegates a pass-through non-monitoring trust to acquire ratings from credit ratings agencies (CRAs). The trust pays outcome contingent fees, such that truth-telling is incentive compatible for CRAs, eliminating ratings inflation. Moreover, because the trust acts as an intermediary, it elimi...