Public Goods and the Hold-Up Problem Under Asymmetric Information

13 Pages Posted: 28 Sep 2012

See all articles by Patrick W. Schmitz

Patrick W. Schmitz

University of Cologne; Centre for Economic Policy Research (CEPR)

Date Written: July 2012

Abstract

An agent can make an observable but non-contractible investment. A principal then offers to collaborate with the agent to provide a public good. Private information of the agent about his valuation may either decrease or increase his investment incentives, depending on whether he learns his type before or after the investment stage.

Keywords: asymmetric information, incomplete contracts, investment incentives, public goods

JEL Classification: D82, D86, H41

Suggested Citation

Schmitz, Patrick W., Public Goods and the Hold-Up Problem Under Asymmetric Information (July 2012). CEPR Discussion Paper No. DP9065. Available at SSRN: https://ssrn.com/abstract=2153516

Patrick W. Schmitz (Contact Author)

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany

HOME PAGE: http://schmitz.uni-koeln.de/index.php?s=mitarbeiter&t=schmitz

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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