Multitask assignments with adverse selection

Minbo Xu, Nina Yin and Sanxi Li

Economics Letters, 2019, vol. 181, issue C, 127-132

Abstract: In a simple multitask assignments model with adverse selection, we derive the optimal contracts when the principal assigns two tasks to different agents or to a single agent. Assigning tasks to different agents introduces a cross-checking device, while assigning tasks to a single agent relaxes participation constraints. The principal prefers to combine tasks to a single agent except for the case in which the correlation of types is positive and strong enough.

Keywords: Multitask assignment; Adverse selection; Optimal contract; Job design (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:181:y:2019:i:c:p:127-132

DOI: 10.1016/j.econlet.2019.05.014

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