Countervailing incentives in adverse selection models. A synthesis
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2014-12Metadatos
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In this paper we propose a simple method of characterizing countervailing incentives in adverse selection problems. The key element in our characterization consists of analyzing properties of the full information
problem. This allows solving the principal problem without using optimal control theory. Our methodology can also be applied to different economic settings: health economics, monopoly regulation, labour contracts, limited liabilities and environmental regulation.