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Multiple period Contracts between Principal and Agent with Adverse Selection, Economic Letters

Abstract

Multi-period contracts with adverse selection at the time of contracting are studied. With risk-neutrality and independent private information, all inefficiency arises in the first period only. With positive serial correlation, inefficiency is more pervasive but declines over time.

Type

Article

Author(s)

David Besanko

Date Published

1985

Citations

Besanko, David. 1985. Multiple period Contracts between Principal and Agent with Adverse Selection. Economic Letters. 17(1-2): 33-37.

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