preserve biodiversity. The design of these policy instruments brings together issues in auction design, contract theory …, biology, and monitoring technology. Using a mixed adverse selection, moral hazard model, we show that optimal contract design …

may make the lending altogether unprofitable. Second, banks can have an incentive to offer a debt contract and additional … equity contracts to intermediate debtors. This combination, however, is in turn dominated by a simple debt contract that is … to avoid the contract with the highest chance of delivery: that contract attracts all bad entrepreneurs. …

lenders, which may make lending altogether unprofitable. Second, banks can have an incentive to offer a debt contract and … additional equity contracts to intermediate debtors, which is in turn dominated by a simple debt contract, only attractive for … seek to avoid the contract with the highest chance of delivery: that contract attracts all bad entrepreneurs. …