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Research literature, 1 records found
Research literature 1 records found  
31 p, 203.6 KB Limited liability and mechanism design in procurement / Burguet, Roberto ; Ganuza Fernández, Juan José ; Hauk, Esther ; Universitat Autònoma de Barcelona. Unitat de Fonaments de l'Anàlisi Econòmica ; Universitat Autònoma de Barcelona. Institut d'Anàlisi Econòmica
In the presence of cost uncertainty, limited liability introduces the possibility of default in procurement with its associated bank-ruptcy costs. When financial soundness is not perfectly observable, we show that incentive compatibility implies that financially less sound contractors are selected with higher probability in any feasible mechanism. [...]
2009 (Working papers ; 767.09)  

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