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.

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Year of publication:	2001
Authors:	Schnedler, Wendelin
Publisher:	Bonn : University of Bonn, Bonn Graduate School of Economics (BGSE)
Subject:	adverse selection \| statistical discrimination \| stochastic order relation

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Series:	Bonn Econ Discussion Papers ; 18/2001
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	869497189 [GVK] hdl:10419/78405 [Handle] RePEc:zbw:bonedp:182001 [RePEc]
Classification:	D82 - Asymmetric and Private Information ; J71 - Discrimination
Source:	EconStor

Persistent link: https://www.econbiz.de/10010317663