Martinez-Gorricho, Silvia; Villalba, Miguel Sanchez - In: SERIEs : Journal of the Spanish Economic Association 12 (2021) 3, pp. 453-487
We generalize the disutility of effort function in the linear-Constant Absolute Risk Aversion (CARA) puremoral hazardmodel.We assume that agents are heterogeneous in ability. Each agent's ability is observable and treated as a parameter that indexes the disutility of effort associated with the...