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We study the design of contracts that incentivize experts to collect information and truthfully report it to a decision maker. We depart from most of the previous literature by assuming that the transfers cannot depend on the realized state or on the ex post payoff of the decision maker. The...
Persistent link: https://www.econbiz.de/10012806483
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
This paper considers the canonical sequential screening model and shows that when the agent has an expost outside option, the principal does not benefit from eliciting the agent's information sequentially. Unlike in the standard model without expost outside options, the optimal contract is...
Persistent link: https://www.econbiz.de/10009381855
This paper studies the structure of optimal finance contracts in an agency model of outside finance, when investors possess private information. We show that, depending on the intensity of the entrepreneur's moral hazard problem, optimal contracts induce full, partial, or no revelation of the...
Persistent link: https://www.econbiz.de/10010366545
We study the effect of additional private information in an agency model with an endogenous information structure. If more private information becomes available to the agent, this may hurt the agent, benefit the principal, and affect the total surplus ambiguously
Persistent link: https://www.econbiz.de/10013158937
strategic complementarities, a uniform regime can have a beneficial social effect as compared to a discretionary reporting …
Persistent link: https://www.econbiz.de/10012951431
Contrary to the prediction of the classic adverse selection theory, a more informed trader could receive better pricing relative to a less informed trader in over‑the‑counter financial markets. Dealers chase informed orders to better position their future quotes and avoid winner’s curse in...
Persistent link: https://www.econbiz.de/10013290336
We show that a solution to the problem of mechanism selection by an informed principal exists in a large class of environments with “generalized private values”: the agents’ payoff functions are independent of the principal’s type. The solution is an extension of Maskin and Tirole’s...
Persistent link: https://www.econbiz.de/10011689318
A mediator, with no prior information and no control over the market protocol, attempts to redesign the information structure in the market by running an information intermediation mechanism with transfers that first elicits information from an agent, and then discloses information to another...
Persistent link: https://www.econbiz.de/10011865067
A liquidity-constrained asset owner designs an asset-backed security to raise funds from an informed liquidity supplier. Information insensitive securities reduce the liquidity supplier's informational rents. The issuer optimally screens the liquidity supplier's private information by offering a...
Persistent link: https://www.econbiz.de/10014255105