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SSRN Electronic Journal
Article . 2010 . Peer-reviewed
Data sources: Crossref
EconStor
Research . 2010
Data sources: EconStor
MPG.PuRe
Research . 2010
Data sources: MPG.PuRe
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Moral Hazard and Ambiguity

Authors: Philipp Weinschenk;

Moral Hazard and Ambiguity

Abstract

We consider a principal-agent model with moral hazard where the agent’s knowledge about the performance measure is ambiguous and he is averse towards ambiguity. We show that the principal may optimally provide no incentives or contract only on a subset of all informative performance measures. That is, the Informativeness Principle does not hold in our model. These results stand in stark contrast to the ones of the orthodox theory, but are empirically of high relevance.

Keywords

financial crisis, Basel Accord, banking regulation, capital requirements, modelbased approach, systemic risk, Moral Hazard, M12, Leistungsbeurteilung, Ambiguity Aversion, ddc:330, M52, Principal-Agent Model, Informationswert, Informativeness Principle, Risikoaversion, D82, Prinzipal-Agent-Theorie, Theorie, jel: jel:D82, jel: jel:M52, jel: jel:M12

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    This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
    7
    popularity
    This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
    Average
    influence
    This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
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    impulse
    This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
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selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
7
Average
Average
Average
bronze