In a dynamic model of asymmetric information between the owner of a firm and a manager, we investigate the optimal set of contingencies on which an incentive contract should depend when renegotiation is possible. In particular, we characterize the circumstances in which the contracting parties...

This article reviews the recent literature on regulation under asymmetric information. We first develop the conceptual framework and offer a reminder of the techniques used in the field. Then we apply the framework and techniques to a variety of situations -- with or without commitment. We...