informational asymmetry and contract design

《informational asymmetry and contract design》由会员上传分享，免费在线阅读，更多相关内容在工程资料-天天文库。

1、8InformationalAsymmetryandContractDesignThethemeofthischapterisinformationalasymmetry,whichisnotthesameasthedifferencesofbeliefsconsideredatvariouspointsinearlierchapters.Beliefsmaydifferwithouttherebeingaconsensusthatanysinglepersonsopinionsareintrinsicallysuperiortoanyoneelses.Insom

2、esituations,however,itwillbecleartoallpartiesinvolvedthatsomeofthemarebetterinformedthanothers.Whenaprincipalemploysanagenttocarryoutactionswhoseoutcomesareuncertainforexample,whenanabsenteelandlordengagesafarmmanagerthelatterwillevidentlybeinabetterpositiontoknowaboutanyshirkingoropp

3、ortunisticbehaviorhechoosestoengagein.Asanotherexample,anexpertjewelerwillevidentlybemorefamiliarwiththequalityofthediamondsheoffersforsalethanwillanordinaryprospectivepurchaser.WewillbeconsideringthefirsttypeofsituationinSection8.1undertheheadingofhiddenactionsormoralhazard.Sections8.

4、2and8.3exploreaspectsofthesecondtypeofsituation,theproblemofhiddenknowledgeoradverseselection.Ineachcasethechallengefacingthelesser-informedpartyistodesignanincentivescheme(acontract)aimedatmitigatingtheeffectsofinformationalasymmetry.1Theprimaryfocusinthischapterwillbeonthechoicesmad

5、e(thecontractsdesigned)byalesswell-informeddecisionmakerorprincipalwhohasmonopolypower.Inthecaseofhiddenactions,introducingcompetitionamongprincipalsaffectstheanalysisinonlyaminorway(seeExercise8.1.2).Ontheotherhand,inthecaseofhiddenknowledge,whenanumberofless-informedtransactorscompe

6、tewithoneanother,subtleissuesariseregardingthenatureofequilibrium.ForthisreasonwedeferadiscussionofcompetitionandhiddenknowledgeuntilChapter9.1InChapter5weconsideredthesituationofadecisionmakerwhoemploysanexpert.Thatdiscussionaddressedonlytheproblemofsincerity,howtoinducetheexperttoac

7、curatelyrevealhishiddenknowledge.3088.1HiddenActions(“MoralHazard”)andContractDesign3098.1HiddenActions(“MoralHazard”)andContractDesign2Supposeanabsenteelandlord(theprincipal)hiresafarmmanagerashisagent.TheagentsutilityfunctionisvA(c,x),whereheractionisx(whichwemaythinkofashereffort)a

8、ndher