A principal faces an agent with private information who is either honest or dishonest. Honesty involves revealing private information truthfully if the probability that the equilibrium allocation chosen by an agent who lies is small enough. Even the slightest intolerance for lying prevents full ethics screening whereby the agent is given proper incentives if dishonest and zero rent if honest. Still, some partial ethics screening may allow for taking advantage of the potential honesty of the agent, even if honesty is unlikely. If intolerance for lying is strong, the standard approach that assumes a fully opportunistic agent is robust. Copyright 2006 by the Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association.
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Article provided by Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association in its journal International Economic Review.
Volume (Year): 47 (2006) Issue (Month): 1 (02) Pages: 59-85 Download reference. The following formats are available: HTML,
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James Andreoni & Brian Erard & Jonathan Feinstein, 1998.
"Tax Compliance,"
Journal of Economic Literature,
American Economic Association, vol. 36(2), pages 818-860, June.
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Andreoni, J. & Erard, B. & Feinstein, J., 1996.
"Tax Compliance,"
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9610r, Wisconsin Madison - Social Systems.
Andreoni, J. & Erard, B. & Feinstein, J., 1996.
"Tax Compliance,"
Working papers
9610, Wisconsin Madison - Social Systems.
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