Existence and monotonicity of optimal debt contracts in costly state verification models

This note gives a simple proof of the existence and monotonicity of optimal debt contracts in simple models of borrowing and lending with ex-post asymmetric information, risk-averse agents and heterogeneous beliefs. Our argument is based on the concept of nondecreasing rearrangement and on a supermodular version of Hardy-Littlewood inequality.

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Year of publication:	2003
Authors:	Renou, Ludovic ; Carlier, Guillaume
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 7.2003, 5, p. 1-9
Publisher:	AccessEcon

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Classification:	G0 - Financial Economics. General ; C6 - Mathematical Methods and Programming
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005110781