"Morální hazard" a "nepříznivý výběr" při maximalizaci pravděpodobnosti ekonomického přežití / Moral hazard and adverse selection when survival probability is maximized [available in Czech only]

Jiri Hlavacek and Michal Hlaváček

No 2006/22, Working Papers IES from Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies

Abstract: This paper analyses problems within the asymmetric information models (principal agent models) where we replace standard assumption of maximisation of expected income by maximisation of probability of economic survival. This paper concentrates on two basic models- adverse selection model and moral hazard model. In both cases the effect of asymmetry of information gets weaker or even disappears. Contrary to standard approach the competitive Pareto effective equilibrium could exists in both models with pooled contract with full coverage of possible accident by the principal

Keywords: principal-agent problem, moral hazard; adverse selection; probability of survival, Pareto distribution of probability (search for similar items in EconPapers)
JEL-codes: D82 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2006-02, Revised 2006-02
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