Electronic markets have grown rapidly in recent years. One of the largest markets on the Internet is the online auction platform eBay that is active in more than 40 countries and has more than 80 million active users. In order to reduce the problems caused by information asymmetries and...

We derive testable implications of model in which first best allocations are not achieved because of a moral hazard problem with hidden saving. We show that in this environment agents typically achieve more insurance than that obtained under autarchy via saving, and that consumption allocation...

We derive testable implications of model in which first best allocations are not achieved because of a moral hazard problem with hidden saving. We show that in this environment agents typically achieve more insurance than that obtained under autarchy via saving, and that consumption allocation...