Concavity-Preserving Integration and Its Application in Principal-Agent Problems

Jia Xie ()
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Jia Xie: Department of Finance, Mihaylo College of Business and Economics, California State University Fullerton

Annals of Economics and Finance, 2018, vol. 19, issue 2, 585-590

Abstract: This paper finds the necessary and sufficient condition for an integration to be concavity preserving. Using this condition, we can, for the first time in the literature of the principal-agent problems, justify the first-order approach without requiring the contract to be monotonic.

Keywords: Concavity-preserving integration; First-order approach; Principalagent problems (search for similar items in EconPapers)
JEL-codes: D8 (search for similar items in EconPapers)
Date: 2018
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