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Government Outsourcing: Public Contracting with Private Monopoly
Auriol, Emmanuelle; Picard, Pierre M. - CESifo - 2006
The paper studies the impact of government budget constraint in a pure adverse selection problem of monopoly regulation …. The government maximizes total surplus but incurs some cost of public funds. An alternative to regulation is proposed in …-post with the private firms. This ex-post contracting set-up allows more flexibility than traditional regulation where …
Persistent link: https://www.econbiz.de/10005765762
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Loans, Insurance and Failures in the Credit Market for Students
Rey, Elena Del; Verheyden, Bertrand - CESifo - 2011
In the education literature, it is generally acknowledged that both credit and insurance for students are rationed. In order to provide a rationale for these observations, we present a model with perfectly competitive banks and risk averse students who have private information on their ability...
Persistent link: https://www.econbiz.de/10008914272
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A Large-Market Rational Expectations Equilibrium Model
Vives, Xavier - CESifo - 2011
This paper presents a market with asymmetric information where a privately revealing equilibrium obtains in a competitive framework and where incentives to acquire information are preserved. The equilibrium is efficient, and the paradoxes associated with fully revealing rational expectations...
Persistent link: https://www.econbiz.de/10009144882
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Wage Dispersion and Labor Turnover with Adverse Selection
Carrillo-Tudela, Carlos; Kaas, Leo - CESifo - 2011
We consider a model of on-the-job search where firms offer long-term wage contracts to workers of different ability. Firms do not observe worker ability upon hiring but learn it gradually over time. With sufficiently strong information frictions, low-wage firms offer separating contracts and...
Persistent link: https://www.econbiz.de/10009293483
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Optimal Student Loans and Graduate Tax under Moral Hazard and Adverse Selection
Gary-Bobo, Robert J.; Trannoy, Alain - CESifo - 2013
We completely characterize the set of second-best optimal “menus”of student-loan contracts in a simple economy with risky labour-market outcomes, adverse selection, moral hazard and risk aversion. The model combines structured student loans and an elementary optimal income-tax problem à la...
Persistent link: https://www.econbiz.de/10010668475
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Team Production in Competitive Labor Markets with Adverse Selection
Siemens, Ferdinand von; Kosfeld, Michael - CESifo - 2014
Team production is a frequent feature of modern organizations. Combined with team incentives, team production can create externalities among workers, since their utility upon accepting a contract depends on their team’s performance and therefore on their colleagues’ productivity. We study...
Persistent link: https://www.econbiz.de/10010743453
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How to Share it out: The Value of Information in Teams
Gershkov, Alex; Li, Jianpei; Schweinzer, Paul - CESifo - 2014
We study the role of information exchange, leadership and coordination in team or partnership structures. For this purpose, we view individuals jointly engaging in productive processes—a ‘team’—as endowed with individual and privately held information on the joint production process....
Persistent link: https://www.econbiz.de/10010812489
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An Experimental Investigation of Risk Sharing and Adverse Selection
Tausch, Franziska; Potters, Jan; Riedl, Arno - CESifo - 2013
Does adverse selection hamper the effectiveness of voluntary risk sharing? How do differences in risk profiles affect adverse selection? We experimentally investigate individuals’ willingness to share risks with others. Across treatments we vary how risk profiles differ between individuals. We...
Persistent link: https://www.econbiz.de/10010639422
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Optimal Income Taxation with Endogenous Participation and Search Unemployment
Lehmann, Etienne; Parmentier, Alexis; Linden, Bruno Van der - CESifo - 2011
We characterize optimal redistributive taxation when individuals are heterogeneous in their skills and their values of non-market activities. Search-matching frictions on the labor markets create unemployment. Wages, labor demand and participation are endogenous. Average tax rates are increasing...
Persistent link: https://www.econbiz.de/10008833925
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Market Transparency, Adverse Selection, and Moral Hazard
Klein, Tobias J.; Lambertz, Christian; Stahl, Konrad O. - CESifo - 2013
We study the effects of improvements in market transparency on eBay on seller exit and continuing sellers’ behavior. An improvement in market transparency by reducing strategic bias in buyer ratings led to a significant increase in buyer valuation especially of sellers rated poorly prior to...
Persistent link: https://www.econbiz.de/10010877941