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We study incumbency advantage in markets with positive consumption externalities. Users of an incumbent platform receive stochastic opportunities to migrate to an entrant and can either accept them or wait for a future opportunity. In some circumstances, users have incentives to delay migration...
How does a profit‐maximizing manager form teams and compensate workers when workers have private information about their productivity and exert hidden effort once in a team? We study a team‐production model in which positive assortative matching is both efficient and profit‐maximizing under pure...
We develop a dynamic model to analyze the impact of input tariff liberalization on input prices, trading decisions, and productivity. Although input tariffs directly affect input price benefits of importing, their impact on trade participation generates indirect benefits through productivity...
Although diversion ratios are important inputs to merger evaluation, there is little evidence about how accurately discrete choice models predict diversions. Using a series of natural disasters that unexpectedly closed hospitals, we compare observed post‐disaster diversion ratios to those...
Prior literature shows that stronger consumer demand leads to increased pharmaceutical R&D. However, how strong these “demand‐pull” effects are for more scientifically novel drug innovation remains unknown. We address this question using comprehensive clinical trial data that include precise...
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