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Natural Disasters, Moral Hazard, and Special Interests in Congress
Kaplan, Carol - 2019
We exploit the precise timing of natural disasters to provide empirical evidence on the connection between electoral accountability and politicians’ support for special interests. We show that, in the immediate aftermath of a disaster, the evening news substantially reduce their coverage of...
Persistent link: https://www.econbiz.de/10012892175
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Deposit Insurance, Moral Hazard and Bank Risk
Karas, Alexei; Pyle, William; Schoors, Koen J. L. - 2021
Using evidence from Russia, we explore the effect of the introduction of deposit insurance on bank risk. Drawing on variation in the ratio of firm deposits to total household and firm deposits before the announcement of deposit insurance, so as to capture the magnitude of the decrease in market...
Persistent link: https://www.econbiz.de/10013249648
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Competitive Procurement with Ex Post Moral Hazard
Chakraborty, Indranil; Khalil, Fahad; Lawarree, Jacques - 2021
Unlike standard auctions, we show that competitive procurement may optimally limit competition or use inefficient allocation rules that award the project to a less efficient firm with positive probability. Procurement projects often involve ex post moral hazard after the competitive process is...
Persistent link: https://www.econbiz.de/10013249652
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When Pro-Poor Microcredit Institutions Favor Richer Borrowers - A Moral Hazard Story
Biancini, Sara; Venet, Baptiste; Ettinger, David - 2021
We suggest an explanation for the existence of “mission drift”, the tendency for Microfinance Institutions (MFIs) to lend money to wealthier borrowers rather than to the very poor. We focus on the relationship between MFIs and external funding institutions. We assume that both the MFIs and...
Persistent link: https://www.econbiz.de/10013245624
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Moral Hazard in Electoral Teams
Cox, Gary W. - 2020
How do parties motivate candidates to exert effort in closed-list elections? If each candidate's primary goal is winning a seat, then those in safe and hopeless list positions have weak incentives to campaign. We present a model in which (i) candidates care about both legislative seats and the...
Persistent link: https://www.econbiz.de/10012830995
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Advantageous Selection Without Moral Hazard (with an Application to Life Care Annuities)
De Donder, Philippe; Leroux, M.‐L; Salanié, François - 2022
Advantageous (or propitious) selection occurs when an increase in the premium of an insurance contract induces high-cost agents to quit, thereby reducing the average cost among remaining buyers. Hemenway (1990) and many subsequent contributions motivate its advent by differences in risk-aversion...
Persistent link: https://www.econbiz.de/10014083046
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Moral Hazard in Drug Purchases
Harju, Jarkko; Verho, J - 2023
We study the moral hazard effects of the drug copayment threshold in Finland using detailed prescription drug purchase data. The analysis reveals that the average drug costs increase discontinuously by 17% at the threshold above which out-of-pocket drug costs decrease substantially. Our results...
Persistent link: https://www.econbiz.de/10014347995
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Regulating Stock Externalities
Gerlagh, Reyer - 2019
-consistent policy rules that implement the stochastic first best as long as a future market exists. We apply our theory to carbon …
Persistent link: https://www.econbiz.de/10012892203
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Regulation of Location-Specific Externalities
Amundsen, Eirik S. - 2019
In this paper, we study regulation of externalities involving many small-scale polluters, where the damages from …
Persistent link: https://www.econbiz.de/10012892205
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Savings Externalities and Wealth Inequality
Angelopoulos, Konstantinos - 2019
externalities via the interest rate. Conditional on differences in the processes determining household earnings for distinct groups … in the population, these savings externalities may contribute to inequality. Working with an open economy heterogenous … earnings processes of British households with university and non-university educated heads entail savings externalities that …
Persistent link: https://www.econbiz.de/10012871023