On the Validity of the First-Order Approach with Moral Hazard and Hidden Assets

Bertola, GiuseppeGiuseppeBertolaKoeniger, WinfriedWinfriedKoeniger2023-04-132023-04-132014-09https://www.alexandria.unisg.ch/handle/20.500.14171/8643910.1016/j.econlet.2014.06.030With moral hazard and anonymous asset trade, first-order conditions need not characterize effort and portfolio choices. The standard procedure for establishing validity of the first-order approach in economies with one hidden asset is not fruitful when multiple assets are hidden.enHidden actionHidden assetsPrincipal agentFirst-order approachOn the Validity of the First-Order Approach with Moral Hazard and Hidden Assetsjournal article