Optimal delegated search with adverse selection and moral hazard
نویسندگان
چکیده
منابع مشابه
Optimal Delegated Search with Adverse Selection and Moral Hazard∗
The paper studies a model of delegated search. The distribution of search revenues is unknown to the principal and has to be elicited from the agent in order to design the optimal search policy. At the same time, the search process is unobservable, requiring search to be self-enforcing. The two information asymmetries are mutually enforcing each other; if one is relaxed, delegated search is eff...
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We consider project financing under adverse selection and moral hazard and derive several interesting results. First, we provide an explanation of why good firms issue both debt and underpriced equity (even if the bankruptcy and agency costs of debt are zero). Second, we show that, in the presence of moral hazard, adverse selection may induce the conversion of negative into positive NPV project...
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We analyze a principal-agent problem with moral hazard where a principal searches for an opportunity of uncertain return, and hires an agent to evaluate available options. The agent’s effort affects the informativeness of a signal about an option’s return. Based on the information provided by the agent, the principal decides whether to exercise the option at hand. We derive properties of the op...
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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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ژورنال
عنوان ژورنال: Theoretical Economics
سال: 2016
ISSN: 1933-6837
DOI: 10.3982/te1801