Market Transparency, Adverse Selection, and Moral Hazard
نویسندگان
چکیده
منابع مشابه
Market Transparency, Adverse Selection, and Moral Hazard
We study how seller exit and continuing sellers’ behavior on eBay are affected by an improvement in market transparency. The improvement was achieved by reducing strategic bias in buyer ratings. It led to a significant increase in buyer satisfaction with seller performance, but not to an increase in seller exit. When sellers had the choice between exiting—a reduction in adverse selection—and im...
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This paper analyzes a canonical principal-agent problem with moral hazard and adverse selection. The agent is risk averse and has private information about his disutility of taking an unobservable action. The principal is risk neutral and designs a menu of contracts consisting of a compensation scheme and a recommended action for each type of agent to maximize expected profit. We first derive a...
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We study a principal-agent model with moral hazard and adverse selection. Agents have private information about the distribution of outcomes conditional on each effort. We characterize the solution of the resulting multidimensional screening problem, and establish several general properties. A positive mass of types with low conditional probabilities of success gets a constant payment and zero ...
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Default rates on instalment loans vary with type of the good purchased. This variation persists even after controlling for contract and consumer-specific characteristics. Using an Italian dataset of instalment loans between 1995-1999, we explore whether such variation is due to unobserved heterogeneity and selection (adverse selection) or due to the effect of the specific features of the good (...
متن کاملAsymmetric Information in Iranian's Health Insurance Market: Testing of Adverse Selection and Moral Hazard.
BACKGROUND Asymmetric information is one of the most important issues in insurance market which occurred due to inherent characteristics of one of the agents involved in insurance contracts; hence its management requires designing appropriate policies. This phenomenon can lead to the failure of insurance market via its two consequences, namely, adverse selection and moral hazard. OBJECTIVE Th...
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ژورنال
عنوان ژورنال: Journal of Political Economy
سال: 2016
ISSN: 0022-3808,1537-534X
DOI: 10.1086/688875