Question
Question 1 In the case of hidden-knowledge type of asymmetric information the principal faces the problem of incentive compatibility when designing contracts for different types
Question 1
In the case of hidden-knowledge type of asymmetric information the principal faces
the problem of incentive compatibility when designing contracts for different types of
agents. Explain why the principal may have an incentive to renegotiate after an
agent has chosen a contract. Is renegotiating contracts an equilibrium outcome?
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Industrial Relations in Canada
Authors: Fiona McQuarrie
4th Edition
978-1-118-8783, 1118878396, 9781119050599 , 978-1118878392
