Similar Search Results

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 … why a coverage-risk correlation may be found in some pools of insurance policies but not in others. We also review the …

Persistent link: https://www.econbiz.de/10012463063

Risk Sharing in Private Information Models with Asset Accumulation : Explaining the Excess Smoothness of Consumption

Attanasio, Orazio - 2007

We derive testable implications of model in which first best allocations are not achieved because of a moral hazard problem with hidden saving. We show that in this environment agents typically achieve more insurance than that obtained under autarchy via saving, and that consumption allocation...

Persistent link: https://www.econbiz.de/10012465662

Efficient Bailouts?

Bianchi, Javier - 2012

in credit markets and the buildup of risk ex ante. During a systemic crisis, bailouts relax balance sheet constraints and … mitigate the severity of the recession. Ex ante, the anticipation of such bailouts leads to an increase in risk-taking, making …

Persistent link: https://www.econbiz.de/10012460074

Real Options in a Dynamic Agency Model, with Applications to Financial Development, IPOs, and Business Risk

Philippon, Thomas - 2007

We study investment options in a dynamic agency model. Moral hazard creates an option to wait and agency conflicts affect the timing of investment. The model sheds light, theoretically and quantitatively, on the evolution of firms' dynamics, in particular the decline of the failure rate and the...

Persistent link: https://www.econbiz.de/10012465063

Contract Renegotiation in Agency Problems

Edlin, Aaron S. - 1997

This paper studies the ability of an agent and a principal to achieve the first-best outcome when the agent invests in an asset that has greater value if owned by the principal than by the agent. When contracts can be renegotiated, a well-known danger is that the principal can hold up the agent,...

Persistent link: https://www.econbiz.de/10012472728

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

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

The Generalized Informativeness Principle

Chaigneau, Pierre - 2014

This paper shows that the informativeness principle, as originally formulated by Holmstrom (1979), does not hold if the first-order approach is invalid. We introduce a "generalized informativeness principle" that takes into account non-local incentive constraints and holds generically, even...

Persistent link: https://www.econbiz.de/10012457937

Risk and the CEO Market : Why Do Some Large Firms Hire Highly-Paid, Low-Talent CEOs?

Edmans, Alex - 2010

This paper presents a market equilibrium model of CEO assignment, pay and incentives under risk aversion and … distorted by the agency problem as firms involving higher risk or disutility choose less talented CEOs. Such firms also pay … higher salaries in the cross-section, but economy-wide increases in risk or the disutility of being a CEO (e.g. due to …

Persistent link: https://www.econbiz.de/10012462666

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

1
2
3
4
5
6
7
8
9
10
Next
Last