We consider an adverse selection model in which the agent can gather private information before the principal offers the contract. In scenario I, information gathering is a hidden action, while in scenario II, it is observable. We study how the two scenarios differ. Specifically, the principal...

We show that the commitment to not allocate may be exploited by a seller/social planner to increase the expected social surplus that can be achieved in the sale of an indivisible unit.

This paper shows that positive correlation between project outcomes may improve the efficiency of microfinance group lending contracts.

This paper examines asymmetric information in the life insurance market using data that link life insurance holdings with death records for a representative sample of purchasers. This analysis finds no compelling evidence for adverse selection in a broad age cohort.