Equity and Adverse Selection
"We introduce concerns with inequity into the canonical adverse selection model. We find that aversion to ex post inequity is not constraining for the principal if the two agents are identical ex ante, but generally is constraining when the agents differ ex ante. Constraining equity concerns can lead to output levels that are either above or below standard levels, and can result in only one agent experiencing systematic inequity in equilibrium." Copyright 2007, The Author(s) Journal Compilation (c) 2007 Blackwell Publishing.
Year of publication: |
2007
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Authors: | Desiraju, Ramarao ; Sappington, David E. M. |
Published in: |
Journal of Economics & Management Strategy. - Wiley Blackwell. - Vol. 16.2007, 2, p. 285-318
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Publisher: |
Wiley Blackwell |
Saved in:
freely available
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