Adverse Selection Models with Three States of Nature

In the paper we analyze an adverse selection model with three states of nature, where both the Principal and the Agent are risk neutral. When solving the model, we use the informational rents and the efforts as variables. We derive the optimal contract in the situation of asymmetric information. The paper ends with the characteristics of the optimal contract and the main conclusions of the model.

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Year of publication:	2011
Authors:	MARINESCU, Daniela ; MARIN, Dumitru
Published in:	Theoretical and Applied Economics. - Asociaţia Generalā a Economiştilor din România - AGER. - Vol. XVIII(2011).2011, 2(555), p. 33-46
Publisher:	Asociaţia Generalā a Economiştilor din România - AGER
Subject:	adverse selection \| asymmetric information \| informational rent \| optimal contract

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Extent:	application/pdf text/html
Type of publication:	Article
Language:	English
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008853092