about the good's quality publicly. We show that the certifier's optimal contract exhibits maximal disclosure but non …-maximal information-gathering. Thus, optimal contracts eliminate private information but not market uncertainty; even though the latter …

The paper studies procurement contracts with pre-project investigations in the presence of adverse selection and moral … with moral hazard. The optimal contract displays systematic distortions in information acquisition. Due to a rent effect … related to false negatives. The optimal mechanism is a menu of option contracts that achieves the dual goal of providing …