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We consider the cost of providing incentives through tournaments when workers are inequity averse and performance … envy depending on the costs of assessing performance. More envious employees are preferred when these costs are high, less …
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One of the main features of health insurance is moral hazard, as defined by Pauly (1968); people face incentives for excess utilization of medical care since they do not pay the full marginal cost for provision. To mitigate the moral hazard problem, a coinsurance can be included in the insurance...
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