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Found 2 Skills
Apply information economics to diagnose and remedy market failures caused by asymmetric information. Use this skill when the user needs to analyze adverse selection, moral hazard, or signaling and screening mechanisms, especially in insurance, labor, credit, or product quality markets.
Apply contract theory to design incentive-compatible agreements under moral hazard and adverse selection. Use this skill when the user needs to structure principal-agent contracts, evaluate compensation schemes, or analyze incomplete contract problems where parties cannot specify all contingencies ex ante.