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Misperceptions, Moral Hazard, and Incentives in Groups
Gaynor, Martin - 1987
Recent work has shown that, in the presence of moral hazard, balanced budget Nash equilibria in groups are not pareto-optimal. This work shows that when agents misperceive the effects of their actions on the joint outcome, there exist a set of sharing rules which balance the budget and lead to a...
Persistent link: https://www.econbiz.de/10012476839
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The Anatomy of Health Insurance
Cutler, David M. - 1999
important. Coinsurance based on expenditure is a crude control mechanism. Moreover, it places no direct incentives on physicians …, who are responsible for most expenditure decisions. To place such incentives on physicians is the goal of supply-side cost …
Persistent link: https://www.econbiz.de/10012471611
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Composition of International Capital Flows : A Survey
Kirabaeva, Koralai - 2009
Finally, we analyze a risk-diversification model, where bond holdings hedge real exchange rate risks, while equities hedge non-financial income fluctuations. An equity home bias emerges as a calibratable equilibrium outcome
Persistent link: https://www.econbiz.de/10012463050
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Testing for Adverse Selection in Insurance Markets
Cohen, Alma - 2009
empirical work that seeks to test the basic coverage-risk prediction of adverse selection theory--that is, that policyholders …
Persistent link: https://www.econbiz.de/10012463063
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Composition of Capital Flows : A Survey
Kirabaeva, Koralai - 2010
We survey several mechanisms that explain the composition of international capital flows: foreign direct investment, foreign portfolio investment and debt flows (bank loans and bonds). We focus on information frictions such as adverse selection and moral hazard, and exposure to liquidity shocks,...
Persistent link: https://www.econbiz.de/10012462165
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Bonus Culture : Competitive Pay, Screening, and Multitasking
Bénabou, Roland - 2013
talented workers leads to an escalating reliance on performance pay and other high-powered incentives, thereby shifting effort … incentives downward in order to extract rents. More generally, as declining market frictions lead employers to compete more …, while inequality tends to rise monotonically. Bonus caps and income taxes can help restore balance in agents' incentives and …
Persistent link: https://www.econbiz.de/10012459725
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Disentangling Moral Hazard and Adverse Selection in Private Health Insurance
Powell, David - 2016
Moral hazard and adverse selection create inefficiencies in private health insurance markets and understanding the relative importance of each factor is critical for policy. We use claims data from a large firm to isolate moral hazard from plan selection. Previous studies have attempted to...
Persistent link: https://www.econbiz.de/10012456814
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Incentives and Government Relief for Risk
Kaplow, Louis - 1989
. This paper explores the effect of such relief on incentives and the allocation of risk in a model with private insurance …
Persistent link: https://www.econbiz.de/10012476041
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Contract Renegotiation in Agency Problems
Edlin, Aaron S. - 1997
-known danger is that the principal can hold up the agent, undermining the agent's investment incentives. We begin by identifying a …
Persistent link: https://www.econbiz.de/10012472728
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Subjective Performance Measures in Optimal Incentive Contracts
Baker, George - 1993
Objective measures of performance are seldom perfect. In response, incentive contracts often include important subjective components that mitigate incentive distortions caused by imperfect objective measures. This paper explores the combined use of subjective and objective performance measures...
Persistent link: https://www.econbiz.de/10012474466