(agri)Environmental contracts, dynamic inconsistencies and moral hazard
From the beginning of the world, the agricultural sector has always played an essential role into our society, and contracts have massively been used by policy-makers for the implementation of (agri)environmental policies, especially when such policies concern the use and development of privately...
| Autor principal: | |
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| Formato: | Second cycle, A2E |
| Lenguaje: | sueco Inglés |
| Publicado: |
2015
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| Materias: | |
| Acceso en línea: | https://stud.epsilon.slu.se/8443/ |
| _version_ | 1855571352410390528 |
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| author | Diakoulakis, Georgios N. |
| author_browse | Diakoulakis, Georgios N. |
| author_facet | Diakoulakis, Georgios N. |
| author_sort | Diakoulakis, Georgios N. |
| collection | Epsilon Archive for Student Projects |
| description | From the beginning of the world, the agricultural sector has always played an essential
role into our society, and contracts have massively been used by policy-makers for the
implementation of (agri)environmental policies, especially when such policies concern
the use and development of privately owned land, and information asymmetries between
policy-makers and individuals exist. Even though the majority of (agri)environmental
contracts are designed assuming individual’s constant time-preferences, recent evidence
from many behavioural studies on individual’s intertemporal choices advocate declining
time-preferences due to behavioural biases, which can be explained by hyperbolic
discounting.
Therefore, in this dissertation we present a theoretical analysis of the impact of
an intertemporal time-inconsistent individual into a contract for the provision of an
(agri)environmental target, under both perfect and imperfect information. Our key finding
suggests that the more inconsistent time-preferences an individual has, the higher
the impact of them into contract design is, unless a commitment mechanism (perfect
information) or higher detection probability of cheaters (imperfect information) is feasible.
We also found that the duration of the contract has a significant impact into it,
only in cases where individuals know precisely (i.e. they have sophisticated beliefs) how inconsistent their time-preferences are. |
| format | Second cycle, A2E |
| id | RepoSLU8443 |
| institution | Swedish University of Agricultural Sciences |
| language | Swedish Inglés |
| publishDate | 2015 |
| publishDateSort | 2015 |
| record_format | eprints |
| spelling | RepoSLU84432015-09-01T14:51:11Z https://stud.epsilon.slu.se/8443/ (agri)Environmental contracts, dynamic inconsistencies and moral hazard Diakoulakis, Georgios N. Economics and management From the beginning of the world, the agricultural sector has always played an essential role into our society, and contracts have massively been used by policy-makers for the implementation of (agri)environmental policies, especially when such policies concern the use and development of privately owned land, and information asymmetries between policy-makers and individuals exist. Even though the majority of (agri)environmental contracts are designed assuming individual’s constant time-preferences, recent evidence from many behavioural studies on individual’s intertemporal choices advocate declining time-preferences due to behavioural biases, which can be explained by hyperbolic discounting. Therefore, in this dissertation we present a theoretical analysis of the impact of an intertemporal time-inconsistent individual into a contract for the provision of an (agri)environmental target, under both perfect and imperfect information. Our key finding suggests that the more inconsistent time-preferences an individual has, the higher the impact of them into contract design is, unless a commitment mechanism (perfect information) or higher detection probability of cheaters (imperfect information) is feasible. We also found that the duration of the contract has a significant impact into it, only in cases where individuals know precisely (i.e. they have sophisticated beliefs) how inconsistent their time-preferences are. 2015-08-27 Second cycle, A2E NonPeerReviewed application/pdf sv https://stud.epsilon.slu.se/8443/1/Diakoulakis_G_150824.pdf Diakoulakis, Georgios N., 2015. (agri)Environmental contracts, dynamic inconsistencies and moral hazard. Second cycle, A2E. Uppsala: (NL, NJ) > Dept. of Economics <https://stud.epsilon.slu.se/view/divisions/OID-510.html> urn:nbn:se:slu:epsilon-s-4799 eng |
| spellingShingle | Economics and management Diakoulakis, Georgios N. (agri)Environmental contracts, dynamic inconsistencies and moral hazard |
| title | (agri)Environmental contracts, dynamic inconsistencies and moral hazard |
| title_full | (agri)Environmental contracts, dynamic inconsistencies and moral hazard |
| title_fullStr | (agri)Environmental contracts, dynamic inconsistencies and moral hazard |
| title_full_unstemmed | (agri)Environmental contracts, dynamic inconsistencies and moral hazard |
| title_short | (agri)Environmental contracts, dynamic inconsistencies and moral hazard |
| title_sort | (agri)environmental contracts, dynamic inconsistencies and moral hazard |
| topic | Economics and management |
| url | https://stud.epsilon.slu.se/8443/ https://stud.epsilon.slu.se/8443/ |