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Moral hazard and ambiguity
Weinschenk, Philipp - 2010
We consider a principal-agent model with moral hazard where the agent's knowledge about the performance measure is ambiguous and he is averse towards ambiguity. We show that the principal may optimally provide no incentives or contract only on a subset of all informative performance measures....
Persistent link: https://www.econbiz.de/10008662585
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Binary payment schemes: moral hazard and loss aversion
Herweg, Fabian; Müller, Daniel; Weinschenk, Philipp - 2010
We modify the principal-agent model with moral hazard by assuming that the agent is expectation-based loss averse according to Köszegi and Rabin (2006, 2007). The optimal contract is a binary payment scheme even for a rich performance measure, where standard preferences predict a fully...
Persistent link: https://www.econbiz.de/10008662594
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Binary payment schemes: Moral hazard and loss aversion
Herweg, Fabian; Müller, Daniel; Weinschenk, Philipp - 2010
We modify the principal-agent model with moral hazard by assuming that the agent is expectation-based loss averse according to Köszegi and Rabin (2006, 2007). The optimal contract is a binary payment scheme even for a rich performance measure, where standard preferences predict a fully...
Persistent link: https://www.econbiz.de/10010286686
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Moral hazard and ambiguity
Weinschenk, Philipp - 2010
We consider a principal-agent model with moral hazard where the agent's knowledge about the performance measure is ambiguous and he is averse towards ambiguity. We show that the principal may optimally provide no incentives or contract only on a subset of all informative performance measures....
Persistent link: https://www.econbiz.de/10010286708
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Procrastination in teams, contract design and discrimination
Weinschenk, Philipp - 2011
We study a dynamic model of team production with moral hazard. We show that the players begin to invest effort only shortly before the time limit when the reward for solving the task is shared equally. We explore how the team can design contracts to mitigate this form of procrastination and show...
Persistent link: https://www.econbiz.de/10010286688
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Procrastination in teams, contract design and discrimination
Weinschenk, Philipp - 2011
We study a dynamic model of team production with moral hazard. We show that the players begin to invest effort only shortly before the time limit when the reward for solving the task is shared equally. We explore how the team can design contracts to mitigate this form of procrastination and show...
Persistent link: https://www.econbiz.de/10009161322
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The role of information in different bargaining protocols
Hortala-Vallve, Rafael; Llorente-Saguer, Aniol; Nagel, … - 2012
exists. We assess the role of incomplete vs. complete information in the efficiency achieved by this new mechanism and by … unconstrained negotiation. We find that unconstrained negotiation does best under a situation of complete information where the … incomplete information. The sources of inefficiencies in each of the two cases arise from the different strategic use of the …
Persistent link: https://www.econbiz.de/10010323864
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Mass media, instrumental information, and electoral accountability
Bruns, Christian; Himmler, Oliver - 2016
common Downsian reasoning, rational voters should not be willing to pay for information out of purely instrumental motives … apply when a group of voters shares a common goal such as accountability and information is delivered via mass media. In … instrumental information in these scenarios. Our model thus reconciles the rational voter approach with the common perception of …
Persistent link: https://www.econbiz.de/10011416918
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Learning About CEO Ability and Stock Return Volatility
Pan, Yihui - 2013
When there is uncertainty about a CEO's quality, news about the firm causes rational investors to update their expectation of the firm's profitability for two reasons: Updates occur because of the direct effect of the news, and also because the news can cause an updated assessment of the CEO's...
Persistent link: https://www.econbiz.de/10013085131
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A World of Cities : The Causes and Consequences of Urbanization in Poorer Countries
Glaeser, Edward L. - 2013
Historically, urban growth required enough development to grow and transport significant agricultural surpluses or a government effective enough to build an empire. But there has been an explosion of poor mega-cities over the last thirty years. A simple urban model illustrates that in closed...
Persistent link: https://www.econbiz.de/10013071513