This book introduces students to optimization theory and its use in economics and allied
disciplines. The first of its three parts examines the existence of solutions to optimization …

Though widely used in executive compensation, inside debt has been almost entirely overlooked
by prior work. We initiate this research by studying CEO pension arrangements in 237 …

An extensive empirical literature in finance has documented not only the presence of anomalies
in the Black-Scholes model, but also the term structures of these anomalies (for instance…

This paper studies the interaction between a single long-lived principal and a series of short-lived
agents in the presence of both moral hazard and adverse selection. We assume that …

We examine the practice of resetting the terms of previously-issued executive stock options.
We identify properties of reset options, develop a model for valuing resettable options, and …

The practice of resetting strike prices on underwater executive stock options has drawn criticism
for weakening managerial incentives. Our model shows that although the anticipation of …

We provide a complete characterization of the set of Markov-Perfect Equilibria (MPE) of
dynamic common-property resource games a la Levhari and Mirman (1980). We find that all …

We investigate the impact of bankruptcy codes on firms’ capital-structure choices. We develop
a theoretical model to identify how firm characteristics may interact with the bankruptcy …

THE THEOREM OF GIrrINS AND JONES (1974) is, perhaps, the single most powerful result
in the literature on Bandit problems. This result establishes that in independent-armed …

The fee structure used to compensate investment advisers is central to the study of fund
design, and affects investor welfare in at least three ways: (i) by influencing the portfolio-…