Regulation under Wealth Constraints
AbstractThis article studies the problem of regulating a monopolist with unknown marginal cost. The problem described differs from Baron and Myerson  because we suppose that the regulator faces a cash-in-advance constraint. The introduction of such a constraint may lead to the collapse of the incentive system.
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Bibliographic InfoPaper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) with number 2000014.
Date of creation: 01 Jun 2000
Date of revision:
Regulation; asymmetric information; monopolist;
Find related papers by JEL classification:
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
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- Mussa, Michael & Rosen, Sherwin, 1978. "Monopoly and product quality," Journal of Economic Theory, Elsevier, vol. 18(2), pages 301-317, August.
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