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Deregulating the economy: centralized vs. market - like systems. The principal-agent perspective applied to the transport sector
Mazzarino, Marco
2000
Abstract
In the paper, the existence of coordination mechanisms capable of achieving Pareto efficiency under uncertainty conditions (information asymmetry) is investigated. Referring to the deregu¬lation processes under way within the transport system, coordination mechanisms are modelled as principal-agent relationships, public sector being the principal and private operators being agents. It is shown that optimum incentive-compatible mechani¬sms (Nash equilibria) in a deregulated system leads to an inefficient allocation of resources unless agents are risk-neutral. It is also shown that using information as a strategic resource there is some room for efficiency improvement by monitoring agents and by repeating the agency relationship over time.
Series
European Transport / Trasporti Europei
VI (2000) 14
Publisher
EUT Edizioni Università di Trieste
ISTIEE Istituto per lo studio dei trasporti nell’integrazione economica europea
Source
Marco Mazzarino, "Deregulating the economy: centralized vs. market - like systems. The principal-agent perspective applied to the transport sector", in: European Transport / Trasporti Europei, VI (2000) 14, pp. 44-50
Languages
en
File(s)