The Virtue of Being Underestimated: A Note on Discriminatory Contracts in Hidden Information Models

A standard hidden information model is considered to study the influence of the a priori productivity distribution on the optimal contract. A priori more productive (hazard rate dominant) agents work less, enjoy lower rents, but generate a higher expected surplus.

MoreLess

Year of publication:	2001-06
Authors:	Schnedler, Wendelin
Institutions:	University of Bonn, Germany
Subject:	adverse selection \| statistical discrimination \| stochastic order relation

More details

Extent:	application/pdf
Series:	Bonn Econ Discussion Papers.
Type of publication:	Book / Working Paper
Language:	English
Notes:	8 pages long
Classification:	D82 - Asymmetric and Private Information ; J71 - Discrimination
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005032208