Similar Search Results

Kovrijnykh, Natalia - In: American Economic Review 103 (2013) 7, pp. 2848-74

This paper analyzes a dynamic lending relationship where the borrower cannot be forced to make repayments, and the lender offers long-term contracts that are imperfectly enforced and repeatedly renegotiated. No commitment and full commitment by the lender are special cases of this model where...

Persistent link: https://www.econbiz.de/10010720108

Liquidity Constraints and Imperfect Information in Subprime Lending

Adams, William; Einav, Liran; Levin, Jonathan - In: American Economic Review 99 (2009) 1, pp. 49-84

down-payment requirements. Lenders also face substantial informational problems. Default rates rise significantly with loan …

Persistent link: https://www.econbiz.de/10004999864

The Great Recession: Lessons from Microeconomic Data

Mian, Atif; Sufi, Amir - In: American Economic Review 100 (2010) 2, pp. 51-56

Persistent link: https://www.econbiz.de/10008584461

Consumer Confusion in the Mortgage Market: Evidence of Less Than a Perfectly Transparent and Competitive Market

Woodward, Susan E.; Hall, Robert E. - In: American Economic Review 100 (2010) 2, pp. 511-15

Persistent link: https://www.econbiz.de/10008584521

Behavioral Constraints on the Design of Subgame-Perfect Implementation Mechanisms

Fehr, Ernst; Powell, Michael; Wilkening, Tom - In: American Economic Review 111 (2021) 4, pp. 1055-1091

We study subgame-perfect implementation (SPI) mechanisms that have been proposed as a solution to incomplete contracting problems. We show that these mechanisms, which are based on off-equilibrium arbitration clauses that impose large fines for lying and the inappropriate use of arbitration,...

Persistent link: https://www.econbiz.de/10013502140

Robustness and Linear Contracts

Carroll, Gabriel - In: American Economic Review 105 (2015) 2, pp. 536-63

We consider a moral hazard problem where the principal is uncertain as to what the agent can and cannot do: she knows some actions available to the agent, but other, unknown actions may also exist. The principal demands robustness, evaluating possible contracts by their worst-case performance,...

Persistent link: https://www.econbiz.de/10011156807

The Cost of Contract Renegotiation: Evidence from the Local Public Sector

Gagnepain, Philippe; Ivaldi, Marc; Martimort, David - In: American Economic Review 103 (2013) 6, pp. 2352-83

Contract theory claims that renegotiation prevents attainment of the efficient solution that could be obtained under … full commitment. Assessing the cost of renegotiation remains an open issue from an empirical viewpoint. We fit a structural … principal-agent model with renegotiation on a set of contracts for urban transport services. The model captures two important …

Persistent link: https://www.econbiz.de/10010815474

Bidding for Incomplete Contracts: An Empirical Analysis of Adaptation Costs

Bajari, Patrick; Houghton, Stephanie; Tadelis, Steven - In: American Economic Review 104 (2014) 4, pp. 1288-1319

paving contracts we show that renegotiation imposes significant adaptation costs. Reduced form regressions suggest that …

Persistent link: https://www.econbiz.de/10010815559

Cognition and Incomplete Contracts

Tirole, Jean - In: American Economic Review 99 (2009) 1, pp. 265-94

Thinking about contingencies, designing covenants, and seeing through their implications is costly. Parties to a contract accordingly use heuristics and leave it incomplete. The paper develops a model of limited cognition and examines its consequences for contractual design. (JEL D23, D82, D86, L22)

Persistent link: https://www.econbiz.de/10004999833

Optimal Contracting with Endogenous Social Norms

Fischer, Paul; Huddart, Steven - In: American Economic Review 98 (2008) 4, pp. 1459-75

Research in sociology and ethics suggests that individuals adhere to social norms of behavior established by their peers. Within an agency framework, we model endogenous social norms by assuming that each agent’s cost of implementing an action depends on the social norm for that action,...

Persistent link: https://www.econbiz.de/10005573699