Moral Hazard in Teams with Uncertainty, and Transfers of Repetition as Enforcement Mechanisms
AbstractProperties of stochastic outcome functions are exploited to solve the moral hazard problem in teams under unobservable individual actions and different individual objectives. Two kinds of enforcement mechanisms are considered: Enforcement through utility transfers and enforcement through repetition. For both more general results are obtained by adapting conditions previously derived to ensure truthful revelation of private information for collective deciSion-making. These conditions are shown to be generic. Also, one of these being weaker than the condition of pairwise identifiability used by Fudenberg, Levine and Maskin, a new Folk theorem is obtained.
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Bibliographic InfoPaper provided by Universite Aix-Marseille III in its series G.R.E.Q.A.M. with number 95a22.
Length: 29 pages
Date of creation: 1995
Date of revision:
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Postal: G.R.E.Q.A.M., (GROUPE DE RECHERCHE EN ECONOMIE QUANTITATIVE D'AIX MARSEILLE), CENTRE DE VIEILLE CHARITE, 2 RUE DE LA CHARITE, 13002 MARSEILLE.
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Other versions of this item:
- d ASPREMONT, Claude & GERARD-VARET, Louis-André, 1994. "Moral Hazard in Teams with Uncertainty, and Transfers or Repetition as Enforcement Mechanisms," CORE Discussion Papers 1994073, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- D2 - Microeconomics - - Production and Organizations
- D7 - Microeconomics - - Analysis of Collective Decision-Making
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- GRECO, Luciano, 2003. "Optimal grants under asymmetric information: federalism versus devolution," CORE Discussion Papers 2003024, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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