This paper surveys research on corporate governance, with special attention to the importance of legal protection of investors and of ownership concentration in corporate governance systems around the world.

A Survey of Corporate Governance

This article surveys research on corporate governance, with special attention to the importance of legal protection of investors and of ownership concentration in corporate governance systems around the world. CORPORATE GOVERNANCE DEALS WITH the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment. How do the suppliers of finance get managers to return some of the profits to them? How do they make sure that managers do not steal the capital they supply or invest it in bad projects? How do suppliers of finance control managers? At first glance, it is not entirely obvious why the suppliers of capital get anything back. After all, they part with their money, and have little to contribute to the enterprise afterward. The professional managers or entrepreneurs who run the firms might as well abscond with the money. Although they sometimes do, usually they do not. Most advanced market economies have solved the problem of corporate governance at least reasonably well, in that they have assured the flows of enormous amounts of capital to firms, and actual repatriation of profits to the providers of finance. But this does not imply that they have solved the corporate governance problem perfectly, or that the corporate governance mechanisms cannot be improved. In fact, the subject of corporate governance is of enormous practical impor

/pdf/a-survey-of-corporate-governance-36f3yobhy4.pdf

Wireless Communications

A Course in Game Theory presents the main ideas of game theory at a level suitable for graduate students and advanced undergraduates, emphasizing the theory's foundations and interpretations of its basic concepts. The authors provide precise definitions and full proofs of results, sacrificing generalities and limiting the scope of the material in order to do so. The text is organized in four parts: strategic games, extensive games with perfect information, extensive games with imperfect information, and coalitional games. It includes over 100 exercises.

A Course in Game Theory

Does finance affect economic growth? A number of studies have identified a positive correlation between the level of development of a country's financial sector and the rate of growth of its per capita income. As has been noted elsewhere, the observed correlation does not necessarily imply a causal relationship. This paper examines whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship; that financial development reduces the costs of external finance to firms. Specifically, we ask whether industrial sectors that are relatively more in need of external finance develop disproportionately faster in countries with more developed financial markets. We find this to be true in a large sample of countries over the 1980s. We show this result is unlikely to be driven by omitted variables, outliers, or reverse causality.

/pdf/financial-dependence-and-growth-2meheeba1z.pdf

Financial Dependence and Growth

Using Cost Observation to Regulate Firms

/pdf/intellectual-property-and-health-in-developing-countries-2yd1mkwamo.pdf

Intellectual property and health in developing countries

Sequential bargaining with many buyers

This paper draws a remarkably simple bridge between auction theory and incentive theory. It considers the auctioning of an indivisible project among several fi rms. The firms have private information about their future cost at th e bidding stage, and the selected firm ex post invests in cost reduct ion. The authors show that (1) the optimal auction can be implemented by a dominant strategy auction that uses information about both the first bid and the second bid; (2) the winner faces a (linear) incenti ve contract; (3) the fixed transfer to the winner decreases with his announced expected cost and increases with the second lowest announce d expected cost; and (4) the share of cost overruns borne by the winn er decreases with the winner's announced expected cost. Copyright 1987 by University of Chicago Press. (This abstract was borrowed from another version of this item.)

Jean Tirole

Papers

Using Cost Observation to Regulate Firms

Intellectual property and health in developing countries

Sequential bargaining with many buyers

Auctioning Incentive Contracts

La théorie économique de la régulation des licenciements