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The revelation and delegation principles in common agency games
Martimort, David; Stole, Lars A. - 2001
In the context of common agency adverse-selection games weillustrate that the revelation principle cannot be applied to studyequilibria of the multi-principal games. We then demonstrate thatan extension of the taxation principle what we term the delegation principle can be used to characterize...
Persistent link: https://www.econbiz.de/10011400675
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Contractual externalities and common agency equilibria
Martimort, David; Stole, Lars A. - 2001
This paper characterizes the equilibrium sets of an intrinsic common agency game with direct exter-nalities between principals both under complete and asymmetric information. Direct externalities arise when the contracting variable of one principal affects directly the other principal s payoff....
Persistent link: https://www.econbiz.de/10011400799
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Mechanism design with moral hazard
Kwon, Suehyun - 2017
This paper studies dynamic mechanism design in the presence of moral hazard. Revelation principle extends to models with moral hazard for both full commitment and limited commitment, but I also identify environments in which the principal doesn't benefit from eliciting agents' private...
Persistent link: https://www.econbiz.de/10011717264
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Adverse selection and moral hazard with multidimensional types
Kwon, Suehyun - 2017 - First draft: March 1, 2017
This paper studies a contracting problem where agents' cost of actions is private information. With two actions, this leads to a two-dimensional screening problem with moral hazard. There is a natural one-dimensional ordering of types when there is both adverse selection and moral hazard....
Persistent link: https://www.econbiz.de/10011718471
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A game-theoretic foundation for the Wilson equilibrium in competitive insurance markets with adverse selection
Mimra, Wanda; Wambach, Achim - 2011
can be withdrawn after observation of competitors' contract offers. We show that an equilibrium always exists where … consumers obtain their respective Wilson-Miyazaki-Spence (WMS) contract. Jointly profit-making contracts can also be sustained … entry. -- casymmetric information ; competitive insurance market ; contract withdrawal …
Persistent link: https://www.econbiz.de/10009011830
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Advantageous selection without moral hazard (with an application to life care annuities)
De Donder, Philippe; Leroux, Marie-Louise; Salanié, … - 2022
Advantageous (or propitious) selection occurs when an increase in the premium of an insurance contract induces high … face two mutually exclusive risks that are bundled together in a single insurance contract. We exemplify this last case … to provide an example of a contract facing advantageous selection. …
Persistent link: https://www.econbiz.de/10013205047
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Strategic delegation in experimental markets
Huck, Steffen; Müller, Wieland; Norman, Hans-Theo - 2000
contracts which determine their managers' salaries. One contract simply gives managers incentives to maximize firm profits …, while the second contract gives an additional sales bonus. Although theory predicts the second contract to be chosen, it is …
Persistent link: https://www.econbiz.de/10009781566
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Attention-driven demand for bonus contracts
Dertwinkel-Kalt, Markus; Köster, Mats; Peiseler, Florian - 2019
, competition does not eliminate but rather exacerbates inefficiencies arising from contracting with focused agents. Common contract …
Persistent link: https://www.econbiz.de/10011983621
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Optimal contracts for discouraging deforestation with risk averse agents
Mason, Charles F. - 2018
There is an emerging consensus that carbon emissions must be limited. An attractive approach to promoting carbon reductions is to encourage reductions in deforestation. But any such strategy must confront a basic problem: agents that might be induced to reduce their actions which would reduce...
Persistent link: https://www.econbiz.de/10011855609
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Learning from failures : optimal contract for experimentation and production
Khalil, Fahad; Lawarrée, Jacques; Rodivilov, Alexander - 2018
derive the optimal contract for both experimentation and production when the agent has private information about his … asymmetric information is endogenously determined by the length of the experimentation stage. An optimal contract uses the length …
Persistent link: https://www.econbiz.de/10011926023