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Moral Hazard and Size Trade in Agency Contracts
Ishiguro, S.; Itoh, H. - Institute of Social and Economic Research (ISER), Osaka … - 1996
The purpose of the paper is to investigate how side track (or collusion) among agents affects the principal's welfare in a hidden action model. We assume that the agent's actions are mutually observable but not contradictable among them and hence direct coordination of actions via side...
Persistent link: https://www.econbiz.de/10008603014
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Poll Subsidy and Excise Tax.
Boyer, M.M. - HEC Montréal (École des Hautes Études Commerciales) - 1998
It is well known that modern governments are unwilling to use poll taxes because it corresponds to political suicide. Still, poll taxes are allegedly the most efficient form of taxation. Building on Eaton and Rosen (1980) and Peck (1989), the goal of this paper is to show a case where an excise...
Persistent link: https://www.econbiz.de/10005775499
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Market Insurance, Self-Insurance and Self-Protection -an Analysis Under the Dual Theory of Choice.
Courbage, C. - Institut d'Economie et Econométrie, Université de Genève - 1999
hypothesis. In particular, background risk, non-reliability, insolvency and asymmetric information are considered. …
Persistent link: https://www.econbiz.de/10010925498
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Market Insurance, Self-Insurance and Self-Protection -an Analysis Under the Dual Theory of Choice.
Courbage, C. - Geneva School of Economics and Management, Université … - 1999
hypothesis. In particular, background risk, non-reliability, insolvency and asymmetric information are considered. …
Persistent link: https://www.econbiz.de/10005486627
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Existence of an Asymmetric Information Structure in Gene Diagnosis -the Mechanism by which Genetic Discrimination is Induced-.
Soga, N. - 2000
In this paper, equilibrium of the life/medical insurance market is analyzed under conditions where insurers demands that an insurant undergo genetic testing, on the assumption that the Human Genome Project will allow direct insight into the precise manner of operation of individual genes. Also,...
Persistent link: https://www.econbiz.de/10005641358
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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
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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
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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 share risks and generates endogenous counterparty risk. Optimal hedging can …
Persistent link: https://www.econbiz.de/10013113017
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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 counterparty risk and contagion from news about the hedged risk to the balance …
Persistent link: https://www.econbiz.de/10012857581
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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