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Robustness of Reputation Effects under Uncertain Monitoring

Yang, Geyu - 2018

I study reputation effects under uncertain monitoring. I examine a repeated game between a long-run player and a series … uncertainty about the monitoring structure introduces new challenges to reputation building because there may not be a direct … ability to establish a reputation for commitment. I show that, when the short-run players cannot statistically distinguish …

Persistent link: https://www.econbiz.de/10012909525

Crowdfunding, demand uncertainty, and moral hazard : a mechanism design approach

Strausz, Roland - 2015

Crowdfunding challenges the traditional separation between finance and marketing. It creates economic value by reducing demand uncertainty, which enables a better screening of positive NPV projects. Entrepreneurial moral hazard threatens this effect. Using mechanism design, mechanisms are...

Persistent link: https://www.econbiz.de/10011309652

STO vs. ICO : a theory of token issues under moral hazard and demand uncertainty

Miglo, Anton - In: Journal of risk and financial management : JRFM 14 (2021) 6, pp. 1-35

This paper considers a financing problem for an innovative firm that is launching a web-based platform. The entrepreneur, on one hand, faces a large degree of demand uncertainty on his product and on the other hand has to deal with incentive problems of professional blockchain participants who...

Persistent link: https://www.econbiz.de/10012587665

Investment under Uncertainty and Correlated Privately Known Costs

Dehghani, Mohammad Hossein - 2019

This paper studies the behavior of two firms after a new investment opportunity arises. Examples of such an investment are technology adoption or market entry. Firms either invest immediately or wait until market uncertainty is resolved. Two types of separating equilibrium are possible when...

Persistent link: https://www.econbiz.de/10012905574

Rational Delay of Effort in Projects with Uncertain Requirements

Külpmann, Philipp - 2018

We analyze a dynamic moral hazard problem in teams with imperfect monitoring in continuous time. In the model, players are working together to achieve a breakthrough in a project while facing a deadline. The effort needed to achieve a breakthrough is unknown but players have a common prior about...

Persistent link: https://www.econbiz.de/10012937113

Optimal Procurement and Investment in New Technologies under Uncertainty

Arve, Malin - 2014

We study a buyer's optimal investment strategy for new technologies when costs evolve stochastically and are private information to the suppliers. In a continuous time setting, we show how the asymmetric information on the stochastic variables leads to delays in investment compared to the real...

Persistent link: https://www.econbiz.de/10013050326

Risk-Sharing or Risk-Taking? Counterparty Risk, Incentives and Margins

Biais, Bruno - 2012

We analyze optimal hedging contracts and show that although hedging aims at sharing risk, it can lead to more risk-taking. News implying that a hedge is likely to be loss-making undermines the risk-prevention incentives of the protection seller. This incentive problem limits the capacity to...

Persistent link: https://www.econbiz.de/10013113017

Risk-Sharing or Risk-Taking? Counterparty Risk, Incentives and Margins

Biais, Bruno - 2020

Derivatives activity, motivated by risk-sharing, can breed risk-taking. Bad news about the risk of the asset underlying the derivative increases the expected liability of a protection seller and undermines her risk-prevention incentives. This limits risk-sharing, and may create endogenous...

Persistent link: https://www.econbiz.de/10012857581

Optimal Lending Contract with Uncertainty Shocks

Villacorta, Alonso - 2014

I develop a dynamic agency model of financial contracting, where borrowing constraints appear as part of the optimal contract. The novelty of the paper relative to previous work is that volatility is stochastic and exogenous to the agent behavior. A line of credit appears in the optimal long...

Persistent link: https://www.econbiz.de/10013060348

Environmental Uncertainty and IT Governance : A Moral Hazard Perspective

Xue, Ling; Ray, Gautam; Gu, Bin - 2010

Prior research considers the IT governance decision to be a trade-off between the cost-efficiency of centralized information processing, and the responsiveness provided by local information processing. Environmental uncertainty plays a major role in this trade-off. In uncertain environments, the...

Persistent link: https://www.econbiz.de/10014219115

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