in the presence of uncertainty about what a country can be good at producing, there can be great social value to discovering costs of domestic activities, because such discoveries can be easily imitated. two failures of the laissez – faire outcome are being highlighted: there is too little investment and entrepreneurship ex ante, and too much production diversi-fication ex post. optimal policy ...

The ex ante real rate of interest is one of the most important concepts in economics and finance. Because the universally-used Fisher theory of interest requires positive ex ante real interest rates, empirical estimates of the ex ante real interest rate derived from the Fisher theory of interest should also be positive. Unfortunately, virtually all estimates of the ex ante real interest rate pu...

The paper studies bilateral contracting with endogenous property rights. Players engage in costly ex post adjustment of ex ante contract. After ex ante agreement on surplus sharing, players invest irreversibly production. Player costs of altering ex ante contract are transaction costs of three kinds: measurement, information and enforcement costs. Each player chooses an action which incurs tran...

Abstract Prioritarianism is a variant of utilitarianism. It differs from utilitarianism in that benefiting individuals matters more the worse off these are. On this view, there are two standard ways handling risky prospects: Ex-Post adjusts for prioritizing final outcomes and then values prospects by expectation sum total those adjusted values, whereas Ex-Ante on each individual's expectations....

In the past few years, there has been an increasing interest in developing project control systems. The primary purpose of such systems is to indicate whether the actual performance is consistent with the baseline and to produce a signal in the case of non-compliance. Recently, researchers have shown an increased interest in monitoring project’s performance indicators, by plotting them on the S...

We study ex post information rents in sequential screening models where the agent receives private ex ante and ex post information. The principal has to pay ex post information rents for preventing the agent to coordinate lies about his ex ante and ex post information. When the agent’s ex ante information is discrete, these rents are positive, whereas they are zero in continuous models. Consequ...

We consider a general mechanism design setting where each agent can acquire (covert) information before participating in the mechanism. The central question is whether a mechanism exists which provides the efficient incentives for information acquisition ex ante and implements the efficient allocation conditional on the private information ex post. It is shown that in every private value enviro...

A strong correlated equilibrium is a strategy pro le that is immune to joint deviations. Di erent notions of strong correlated equilibria were de ned in the literature. One major di erence among those de nitions is the stage in which coalitions can plan a joint deviation: before (ex-ante) or after (ex-post) the deviating players receive their part of the correlated pro le. In this paper we prov...

The percentage of S&P500 firms that offer ex-ante severance agreements to their CEOs grew from 20% in 1993 to more than 55% in 2007 despite controversial discussions on executive severance contracts in the media and academic studies. In addition, about 40% of firms offer their CEOs severance contracts with cash-only payouts. Our paper focuses on this recent spread of ex-ante CEO severance agree...

We present a model of N-player contracting with transaction costs and endogenous property rights. Ex ante agreed surplus sharing can be altered ex post, after irreversible investments in production (characterised by the generalised Cobb-Douglas production function). The actual surplus sharing is determined ex post, after each player has chosen a costly action to alter the surplus sharing in his...