Journal of Political Economy Vol. 97 No. 6 1989
Profit Regulation of Defense Contractors and Prizes for Innovation
Abstract
This paper argues that regulatory institutions in defense procurement are (and necessarily must be) organized to create prizes for innovation in the form of positive economic profit on production contracts. This has a number of important policy implications. The values of the prizes on 12 major aerospace projects are estimated using stock market data and shown to be large.
- DOI
- 10.1086/261654
- Volume
- 97
- Issue
- 6
- Pages
- 1284-1305
- Language
- en
- Sources
- openalex crossref