We examine the optimal design of two-stage research and development (R&D) joint ventures. At the second stage, researchers choose R&D effort levels independently in an attempt to achieve an innovation. In the first stage, researchers have an opportunity to share endowments of productive...

We study a principal–agent model in which the agent is boundedly rational in his ability to understand the principal's decision rule. The principal wishes to elicit an agent's true profile so as to determine whether or not to grant him a certain request. The principal designs a questionnaire...

This paper develops and implements a statistical methodology to account for the equilibrium effects (aka adverse selection) in design of risk adjustment formula in health insurance markets. Our setting is modeled on the situation in Medicare and the new state Exchanges where individuals sort...