Sanford J Grossman
Biographic Data
| ID | 5849084 |
|---|---|
| NAME | Sanford J Grossman |
| GIVEN NAMES | Sanford J |
| FAMILY NAME | Grossman |
| SIGNATURE | GROSSMAN S J |
| AFFILIATIONS | Massachusetts Institute of Technology |
| VERIFIED | No |
| TOTAL WORKS | 7 |
| TOTAL CITATIONS | 407 |
| WORKS AS AUTHOR | 7 |
| WORKS AS EDITOR | 0 |
| FIRST PUBLICATION YEAR | 1980 |
| LATEST PUBLICATION YEAR | 1987 |
| H-INDEX | 2 |
Estimating the Continuous-Time Consumption-Based Asset-Pricing Model
The consumption-based asset-pricing model predicts that excess yields are determined by the market's degree of relative risk aversion and by the covariances of per capita consumption growth with asset returns. Estimation and testing are complicated by the fact that the model's predictions relate to the instantaneous flow of consumption and point-in-time asset values, but only data on the integral or time average of the consumption flow are availa…
The Costs and Benefits of Ownership
Our theory of costly contracts emphasizes the contractual rights can by of two types: specific rights and residual rights. When it is costly to list all specific rights over assets in the contract, it may be optimal to let one party purchase all residual rights. Ownership is the purchase of these residual rights. When residual rights are purchased by one party, they are lost by a second party, and this inevitably creates distortions. Firm 1 purch…
An Analysis of the Principal-Agent Problem
Most analyses of the principal-agent problem assume that the principal chooses an incentive scheme to maximize expected utility subject to the agent's utility being at a stationary point.An important paper of Mirrlees has shown that this approach is generally invalid.We present an alternative procedure.If the agent's preferences over income lotteries are independent of action, we show that the optimal way of implementing an action by the agent ca…
Unemployment with Observable Aggregate Shocks
A general equilibrium model of optimal employment contracts is developed where firms have better information about labor's marginal product than workers. It is optimal for the wage to be tied to the level of employment, to prevent the firm from falsely stating that the marginal product is low and cutting the wage. It is shown that an observed aggregate shock that leads to an interindustry shift in labor demand and that would have no effect on tot…
Unemployment with Observable Aggregate Shocks
A general equilibrium model of' optimal employment contracts is developed where firms have better information about labor's marginal product than workers. It is optimal for the wage to be tied to the level of employment, to prevent the firm from falsely stating that the marginal product is low and cutting the wage. It is shown that an observed aggregate shock that leads to an interindustry shift in labor demand and that would have no effect on to…
Heterogeneous Information and the Theory of the Business Cycle
The inability to observe the money supply and price level has been an essential ingredient of informational based equilibrium models of cycles. Here we assume these data are available but show that heterogeneous information about the productivity of capital can lead to a monetary theory of fluctuations. In equilibrium, each agent's investment depends on the difference between his own productivity and the perceived real rate. In the presence of mo…
Takeover Bids, The Free-Rider Problem, and the Theory of the Corporation
It is commonly thought that a widely held corporation that is not being run in the interest of its shareholders will be vulnerable to a takeover bid. We show that this is false, since shareholders can free ride on the raider's improvement of the corporation, thereby seriously limiting the raider's profit. We analyze exclusionary devices that can be built into the corporate charter to overcome this free-rider problem. We study privately and social…
The Costs and Benefits of Ownership
Our theory of costly contracts emphasizes the contractual rights can by of two types: specific rights and residual rights. When it is costly to list all specific rights over assets in the contract, it may be optimal to let one party purchase all residual rights. Ownership is the purchase of these residual rights. When residual rights are purchased by one party, they are lost by a second party, and this inevitably creates distortions. Firm 1 purch…
Heterogeneous Information and the Theory of the Business Cycle
The inability to observe the money supply and price level has been an essential ingredient of informational based equilibrium models of cycles. Here we assume these data are available but show that heterogeneous information about the productivity of capital can lead to a monetary theory of fluctuations. In equilibrium, each agent's investment depends on the difference between his own productivity and the perceived real rate. In the presence of mo…
Takeover Bids, The Free-Rider Problem, and the Theory of the Corporation
It is commonly thought that a widely held corporation that is not being run in the interest of its shareholders will be vulnerable to a takeover bid. We show that this is false, since shareholders can free ride on the raider's improvement of the corporation, thereby seriously limiting the raider's profit. We analyze exclusionary devices that can be built into the corporate charter to overcome this free-rider problem. We study privately and social…
Unemployment with Observable Aggregate Shocks
A general equilibrium model of' optimal employment contracts is developed where firms have better information about labor's marginal product than workers. It is optimal for the wage to be tied to the level of employment, to prevent the firm from falsely stating that the marginal product is low and cutting the wage. It is shown that an observed aggregate shock that leads to an interindustry shift in labor demand and that would have no effect on to…
Heterogeneous Information and the Theory of the Business Cycle
The inability to observe the money supply and price level has been an essential ingredient of informational based equilibrium models of cycles. Here we assume these data are available but show that heterogeneous information about the productivity of capital can lead to a monetary theory of fluctuations. In equilibrium, each agent's investment depends on the difference between his own productivity and the perceived real rate. In the presence of mo…
An Analysis of the Principal-Agent Problem
Most analyses of the principal-agent problem assume that the principal chooses an incentive scheme to maximize expected utility subject to the agent's utility being at a stationary point.An important paper of Mirrlees has shown that this approach is generally invalid.We present an alternative procedure.If the agent's preferences over income lotteries are independent of action, we show that the optimal way of implementing an action by the agent ca…
Unemployment with Observable Aggregate Shocks
A general equilibrium model of optimal employment contracts is developed where firms have better information about labor's marginal product than workers. It is optimal for the wage to be tied to the level of employment, to prevent the firm from falsely stating that the marginal product is low and cutting the wage. It is shown that an observed aggregate shock that leads to an interindustry shift in labor demand and that would have no effect on tot…
The Costs and Benefits of Ownership
Our theory of costly contracts emphasizes the contractual rights can by of two types: specific rights and residual rights. When it is costly to list all specific rights over assets in the contract, it may be optimal to let one party purchase all residual rights. Ownership is the purchase of these residual rights. When residual rights are purchased by one party, they are lost by a second party, and this inevitably creates distortions. Firm 1 purch…
Estimating the Continuous-Time Consumption-Based Asset-Pricing Model
The consumption-based asset-pricing model predicts that excess yields are determined by the market's degree of relative risk aversion and by the covariances of per capita consumption growth with asset returns. Estimation and testing are complicated by the fact that the model's predictions relate to the instantaneous flow of consumption and point-in-time asset values, but only data on the integral or time average of the consumption flow are availa…
Economics (7 works) · Economic theories and models (5 works) · Microeconomics (5 works) · Econometrics (4 works) · Demand shock (3 works) · Macroeconomics (3 works) · Perfect information (3 works) · Computer Science (2 works) · Incentive (2 works) · Labor market dynamics and wage inequality (2 works)