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Applied Contract Theory: Governance and Institutions

Lecturer: Professor Christoph Luelfesmann (Simon Fraser University, Vancouver)
Date: July 8-10, 2019
Venue: TU Dresden, Münchner Platz 1-3, 01187 Dresden, room SCH B 37
Registration: Please contact Yvonne Bludau, E-mail: yvonne.bludau@tu-dresden.de, until May 15, 2019.

Participation is limited (max. 15).

Announcement pdf

Course Description
This special course studies the contractual relationships of economic agents. The first part briefly introduces principal agent theory as an important theoretical tool. We ask how a ‚principal‘ (firm owner, central government, bank etc.) should optimally design the contracts with her ‚agents‘ (managers, lower-level governments, borrowers) to either elicit private information (Adverse Selection), or to let agents choose appropriate effort levels (Moral Hazard). We also discuss incomplete contracting as an important building block for an ownership-based theory of the firm. The second part of the course then applies these concepts to various interesting real-world issues, to come up with often surprising results.

Course Requirements
Hand in solutions of exercises

Schedule of Classes
July 8:     10:00–12:00 and 13:30–16:00
July 9:     10:00–12:00 and 13:30–16:00
July 10:   10:00–12:00 and 13:30–16:00