We present the optimal contract for financing a project that has N stages to be completed sequentially when the principal can not commit to abandone the project before it is completed and the project to be completed is valued by the agent. In a dynamic moral hazard setting, we find that the...

This paper studies optimal contracts and monitoring policies in procurement under dynamic adverse selection and moral hazard concerning a cost-reducing investment decision. I assume fixed costs of investment and show that the resulting 'lumpy' investment behavior creates a motive to monitor...

We prove a folk theorem for multiplayer games in continuous time when players observe a public signal distorted by Brownian noise. The proof is based on a rigorous foundation for such continuous-time multiplayer games. We study in detail the relation between behaviour and mixed strategies, and...