In this paper we formulate an infinitely repeated Principal-Agent relationship as a Multi-Objective Optimization problem. We numerically approximate the solution of this model using a Multi-Objective Optimization Evolutionary Algorithm, named RankMOEA, for different values of the Agent's...

We analyze a situation where a Principal does not necessarily have all the bargaining power while negotiating a contract with an Agent by studying a dynamic multi-objective moral hazard model with hidden action. We .nd that the structure of the optimal contracts change along the Pareto Frontier,...

We use Evolutionary Algorithms to approximate the Pareto frontier of a dynamic Principal-Agent model with discrete actions. The Pareto frontier that we obtain is concave, a result that is due to the asymmetry of information between the Principal and the Agent. As we move in the Pareto frontier...

In this article, we evaluate the relationship and the interaction between financial development, grades of cooperation, in terms of trust and reciprocity, and participation in social networks of the members of a savings and loan association. We used exchanged money quantities according to the...

We study the problem of an investor that buys an equity stake in a entrepreneurial venture, under the assumption that the former cannot monitor the latter’s operations. The dynamics implied by the optimal incentive scheme is rich and quite different from that induced by other models of...

The coexistence of formal and informal suppliers of credit in a market generates the need of analyzing how those suppliers interact to satisfy the households’ demand of financial services. The objective of such analysis is the identification of an institutional design that allows the deepening...

In this article we analyze an automobile market in México to find evidence of consumer behavior motivated by temptation and auto-control, according to the preferences proposed by Gul and Pesendorfer (2001). The analysis considers an environment with non-linear prices that take into account the...

contract. We focus our attention on testable implications: (i) the relationship between compensation and firm size, (ii) the relative importance of current and deferred compensation, (iii) the sensitivity of compensation to innovations in shareholder wealth, and (iv) the relationship between...

In this article we use a multivariate framework to estimate net profits and levels of capital and labor for informal Mexican microfirms had they been formal. We estimate a Roy model to simultaneously model three different microfirm responses conditional on the sector (formal or informal) choice....