We develop a dynamic model of debt contracts with adverse selection and belief updates. In the model, entrepreneurs borrow investment goods from lenders to run businesses whose returns depend on entrepreneurial productivity and common productivity. Entrepreneurial productivity is the...

I formalise a rather stylised insurance market with adverse selection as a standard duopoly. I formally specify demand functions and profits and I prove that a Nash equilibrium in pure strategies exists if and only if the well-known Rothschild-Stiglitz allocation is efficient

Two issues in land tenure contracts in agriculture that have vexed economists are (1) the appearance and co-existence of multiple contracts, often in adjoining plots of land and (2) the choice of a share-cropping contract because a share contract being analogous to a proportional tax, is...

Two issues in land tenure contracts in agriculture that have vexed economists are (1) the appearance and co-existence of multiple contracts, often in adjoining plots of land and (2) the choice of a share-cropping contract because a share contract being analogous to a proportional tax, is...

We solve the principal-agent problem of a monopolist insurer selling to an agent whose riskiness (loss chance) is private information, a problem introduced in Stiglitz's (1977) seminal paper. For an \emph{arbitrary} type distribution, we prove several properties of optimal menus, such as...

Two issues in land tenure contracts in agriculture that have vexed economists are (1) the appearance and co-existence of multiple contracts, often in adjoining plots of land and (2) the choice of a share-cropping contract because a share contract being analogous to a proportional tax, is...

The notion of uncertain delivery is extended to study exchange economies in which agents have different abilities to distinguish between goods (for example a car in good condition versus a car in bad condition). In this setting, it is useful to distinguish goods not only by their physical...

In this paper the problem of optimal derivative design, profit maximization and risk minimization under adverse selection when multiple agencies compete for the business of a continuum of heterogenous agents is studied. In contrast with the principal-agent models that are extended within, here...

Azevedo and Gottlieb [2017] (AG) define a notion of equilibrium that always exists in the Rothschild and Stiglitz [1976] (RS) model of competitive insurance markets, provided costs are bounded. However, equilibrium predictions are sensitive to assumptions made about the upper bound of cost:...

In this paper the problem of optimal derivative design, profit maximization and risk minimization under adverse selection when multiple agencies compete for the business of a continuum of heterogenous agents is studied. In contrast with the principal-agent models that are extended within, here...