Moral Hazard and Observability

19798,426 citationsJournal Article

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Abstract

The role of imperfect information in a principal-agent relationship subject to moral hazard is considered. A necessary and sufficient condition for imperfect information to improve on contracts based on the payoff alone is derived, and a characterization of the optimal use of such information is given.

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Economic theories and models Auction Theory and Applications Law, Economics, and Judicial Systems

Publication Details

Published in: The Bell Journal of Economics

Volume 10, Issue 1, pp. 74-74

DOI: 10.2307/3003320

Field-Weighted Citation Impact: 116.23

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Moral Hazard and Observability

Authors

Abstract

Topics & Keywords

Publication Details