RISKâ€ SHARING MATCHING AND MORAL HAZARD
Sanxi Li () and
Bulletin of Economic Research, 2018, vol. 70, issue 2, 165-174
In this study we model the endogenous relationship formation between riskâ€ averse principals and agents in a CARAâ€ normal framework. Agents exert unobservable efforts to increase mean outputs and reduce risks. We show that riskâ€ reduction efforts are more important than meanâ€ increasing efforts in determining the matching patterns. Compared to cases without moral hazard, the agency problem in risk reduction induces more positiveâ€ assortative matchings.
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:buecrs:v:70:y:2018:i:2:p:165-174
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0307-3378
Access Statistics for this article
More articles in Bulletin of Economic Research from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().