The role of information’s processing in bank intermediation is a crucial input. The bank has access to different types of information in order to manage risk through capital allocation for Value at Risk coverage. Hard information, contained in balance sheet data and produced with credit...

The theoretical aspects of three generation of financial crisis’ models are analyzed. On the basis of retrospective analysis of these models are determined the main causes than make the economic misbalance more profound and than cause a crisis. Проаналізовано теоретичні...

We analyze the optimal regulation of a MFI that has private information on the intrinsic quality of its loan portfolio (adverse selection) and where the MFI’s choice of effort to improve this quality cannot be observed by the regulator (moral hazard). In designing optimal contracts the...

The decision to cooperate within R&D joint ventures is often based on `expert advice.' Such advice typically originates in a due diligence process, which assesses the R&D joint venture's profitability, for example, by appraising the achievability of synergies. We show that if the experts who...

The negative aspects of influence of globalization’s externalities on national financial system and the role of globalization in the development of crisis are analyzed. The author considers modern methods of regulation of short term capital flows, which influence on the financial market is...

This study analyzes a continuous-time N-agent Brownian hidden-action model with exponential utilities, in which agents' actions jointly determine the mean and the variance of the outcome process. In order to give a theoretical justi¯cation for the use of linear contracts, as in Holmstrom and...

The recent global crisis has forced many countries to a tight fiscal discipline. As a consequence, the cultural sectors in those countries have experienced severe budget cuts. In this context, disparate suggestions for additional sources of revenue available to public institutions have emerged....

This paper analyses the feasibility of profit and loss sharing (PLS) contracts in presence of moral hazard between the principal (financier) and the agent (entrepreneur). It shows that introducing a rule for sharing profits and losses in contingence with the outcome of the entrepreneur’s...

The standard explanation of wage rigidity in principal agent and in efficiency wage models is related to worker risk-aversion. However, these explanations do not consider at least two important classes of empirical evidence: (1) In worker cooperatives workers appear to behave in a less risk...

This paper describes how state-of-the-art methods of choice modeling can be used to analyze consumer choice behavior in "competitive" health insurance markets. I use the insurance choices of senior citizens in the U.S. as an example. I then consider the issue of whether consumers benefit when we...