Extending the notion of contractual pricing introduced by Makowski and Ostroy (2003) to economies with moral hazard, this paper develops a model of team formation and organized competition with three main contributions. Firstly, a team’s organization is defined as an allocation of (public or private) commodities together with incentive compatible actions and information to its members. Secondly...

This paper studies the incentives of a bidder to acquire information in an auction when her information acquisition decision is observed by the other bidders before they bid. Our results show that the incentives are stronger in a sealed bid (second price) auction than in an open (English) auction when the information acquired refers to a common component of the value. However, the ranking is th...

This paper considers multivariate extension of smooth estimator of the distribution and density function based on Bernstein polynomials studied in Babu et al. [2002. Application of Bernstein polynomials for smooth estimation of a distribution and density function. J. Statist. Plann. Inference 105, 377–392]. Multivariate version of Bernstein polynomials for approximating a bounded and continuous...

Energy costs are notoriously uncertain but what is the effect of this on energysaving investments? We find that real-option frictions imply a novel equilibrium response to increasing but uncertain energy costs: early investments are cautious but ultimately real-option frictions endogenously vanish, and the activity affected by higher energy costs fully recovers. We use electricity market data f...

In a standard financial market model with asymmetric information with a finite number N of risk-averse informed traders, competitive rational expectations equilibria provide a good approximation to strategic equilibria as long as N is not too small: equilibrium prices in each situation converge to each other at a rate of 1/N as the market becomes large. The approximation is particularly good wh...

The invisible hand of a perfectly competitive market refers to the self-regulating behavior where if each consumer and producer are allowed freely make their own choices, settles at an efficient outcome that is beneficial all individual members society hence as whole. Two well-known facets generally mentioned in economics literature—the first one static picture market, i.e. equilibrium; second ...

the conventional theory of adverse selection is not supported by most of the empirical works. these studies conclude that low-risk individuals demand more insurance services than high-risks. they refer to this situation as advantageous selection theory. this theory states that loss ratio of insureds may be lower than the population loss ratio while the conventional theory of adverse selection c...

The literature focused on analyzing profit persistence in the agricultural sector is scarce. This paper contributes to reducing this gap by carrying out an empirical study of 10 types farming Spain based a dynamic panel model with microeconomic data from large sample farms provided Spanish Farm Accountancy Data Network. generalized method moments system estimator used assess persistence, includ...

the purchase of insurance may cause the insureds to increase the costs of insurance companies, compared to their estimation of costs. if after the demand of insurance services, the loss ratio of insurance companies increases because of consumer behavior, moral hazard will be evident. in this paper, after introducing the literature, the presence of moral hazard in iran insurance company is teste...