Moral hazard with non-additive uncertainty: When are actions implementable? Articles uri icon

publication date

  • October 2018

start page

  • 110

end page

  • 114

volume

  • 171

International Standard Serial Number (ISSN)

  • 0165-1765

Electronic International Standard Serial Number (EISSN)

  • 1873-7374

abstract

  • We provide sufficient conditions on the information structure for implementing actions in a moral hazard setting when Agent has non-probabilistic uncertainty. For a finite action space, under three well-known formulations of Agent's ambiguity attitude, contracts that partition the outcome space in two parts, and are piecewise constant on each part, are enough to implement an action.

subjects

  • Economics

keywords

  • moral hazard; non-probabilistic uncertainty; ambiguity aversion; implementability