The objective of this paper is to pursue an intuitive idea: For a consumer who is an unfavorable health risk but a “better risk” regarding a second peril, would a multi-peril policy not be associated with a reduced selection effort on the part of the insurer? If this intuition should be...

Sectoral crediting has been proposed as a way to scale up project-level carbon offset programs, and provide sector-wide incentives for developing countries to reduce greenhouse gas emissions. However, simulations presented here suggest that information asymmetries and large uncertainties in...

In this survey we present some of the more signi ficant results in the literature on adverse selection in insurance markets. Sections 1 and 2 introduce the subject and Section 3 discusses the monopoly model developed by Stiglitz (1977) for the case of single-period contracts extended by many...

Recent diffusion models cannot explain why the success of technology diffusion depends so critically on developing countries’ human capital levels. This paper examines three main issues. First, we endogenize both appropriate technologies and human capital formation. Second, we refine the human...

We consider a principal-agent relationship with adverse selection. Principals pay informational rents due to asymmetric information and sell their output in a homogeneous Cournot-oligopoly. We find that asymmetric information may mitigate or more than compensate the welfare reducing impact of...

A principal hires an agent to learn about the cost of a project (experimentation) and then to execute it (production). The agent is privately informed about the probability that the cost is low, with the high-type agent being relatively more optimistic than the low type. The agent also engages...