The political economy of moral hazard
AbstractConventional theory explains moral hazard as a consequence of information asymmetries. The present paper proposes an alternative approach. We argue that information asymmetries are just one among several causes of moral hazard and that they entail negative consequences for third parties only accidentally. By contrast, moral hazard also results from government interventionism. And in this case negative consequences are systematic and do result even in the absence of information asymmetries.
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Bibliographic InfoArticle provided by University of Economics, Prague in its journal Politická ekonomie.
Volume (Year): 2006 (2006)
Issue (Month): 1 ()
Postal: Redakce Politické ekonomie, Vysoká škola ekonomická, nám. W. Churchilla 4, 130 67 Praha 3
Find related papers by JEL classification:
- D00 - Microeconomics - - General - - - General
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
- K00 - Law and Economics - - General - - - General (including Data Sources and Description)
- P00 - Economic Systems - - General - - - General
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