IDEAS home Printed from https://ideas.repec.org/a/spr/reecde/v6y2001i1p41-61.html
   My bibliography  Save this article

original papers : Implementation of optimal contracts under adverse selection

Author

Listed:
  • Pablo AmorÕs

    (Departamento TeorÎa e Historia EconÕmica, Universidad de MÂlaga, Campus El Ejido, E-29013, MÂlaga, Spain)

  • Bernardo Moreno

    (Departamento TeorÎa e Historia EconÕmica, Universidad de MÂlaga, Campus El Ejido, E-29013, MÂlaga, Spain)

Abstract

This paper studies a 2-agent, 2-type principal-multiagent model of adverse selection under the assumption that the agents each have complete information. We construct a mechanism implementing the first-best contracts in Nash equilibrium that: satisfies a condition related to individual rationality, is renegotiation-proof, has a small-sized message space, achieves unique implementation and satisfies undomination of Nash equilibrium strategies. Moreover, we prove that other requirements which relate to individual rationality (different from the one satisfied by our mechanism) are not compatible with implementation of the first-best contracts.

Suggested Citation

  • Pablo AmorÕs & Bernardo Moreno, 2001. "original papers : Implementation of optimal contracts under adverse selection," Review of Economic Design, Springer;Society for Economic Design, vol. 6(1), pages 41-61.
    • Handle: RePEc:spr:reecde:v:6:y:2001:i:1:p:41-61
    Note: Received: 27 July 1998 / Accepted: 26 May 2000
    as

    Download full text from publisher

    File URL: http://link.springer.de/link/service/journals/10058/papers/1006001/10060041.pdf
    Download Restriction: Access to the full text of the articles in this series is restricted
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Matthew O. Jackson, 2001. "A crash course in implementation theory," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 18(4), pages 655-708.
    2. Amoros, Pablo, 2004. "Nash implementation and uncertain renegotiation," Games and Economic Behavior, Elsevier, vol. 49(2), pages 424-434, November.

    More about this item

    Keywords

    Adverse selection; Contract theory; Implementation theory; Nash equilibrium;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:reecde:v:6:y:2001:i:1:p:41-61. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.