ERC Advanced Grant · 2019
Welfare, Incentives, Dynamics, and Equilibrium
Informational frictions lead to inefficient allocations, reducing welfare. Dynamic incentive theory offers a powerful conceptual framework to analyse the optimal design of contracts and mechanisms mitigating these inefficiencies. Its technical difficulty and abstractness, however, have limited its applications. The objective of this project is to develop new frameworks to enhance the applicability of dynamic incentive theory and address important unanswered applied questions: 1) In corporate finance, I will evaluate the quantitative relevance of dynamic contract theory. To do so, I will develop a new structural econometric framework and estimate the magnitude of dynamic incentive problems…
From the public funding record at EU CORDIS. Describes the funded project, not the reviews below.