Public goods and the hold-up problem under asymmetric information

An agent can make an observable but non-contractible investment. A principal then offers to collaborate with the agent to provide a public good. Private information of the agent about his valuation may either decrease or increase his investment incentives, depending on whether he learns his type before or after the investment stage.

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Year of publication:	2012
Authors:	Schmitz, Patrick W.
Published in:	Economics Letters. - Elsevier, ISSN 0165-1765. - Vol. 117.2012, 3, p. 642-645
Publisher:	Elsevier
Subject:	Asymmetric information \| Incomplete contracts \| Investment incentives \| Public goods

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Type of publication:	Article
Classification:	D82 - Asymmetric and Private Information ; D86 - Economics of Contract: Theory ; H41 - Public Goods
Source:	RePEc - Research Papers in Economics

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