| Registro completo |
| Provedor de dados: |
AgEcon
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| País: |
United States
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| Título: |
Bidding behavior in environmental contract auctions with incomplete monitoring
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| Autores: |
Romstad, Eirik
Alfnes, Frode
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| Data: |
2011-09-02
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| Ano: |
2011
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| Palavras-chave: |
Environmental contract auctions
Monitoring and compliance
Truthful revelation
Environmental Economics and Policy
Resource /Energy Economics and Policy
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| Resumo: |
It is well known from the compliance literature that whenever it costly to monitor agents' compliance to contract terms, compliance is likely to be incomplete. This paper goes one step further by examining the implications of incomplete monitoring on agent's sales offers in auctions for environmental contracts. From a monitoring perspective we show allocation contracts to least cost also produces another gain – that less resources need to be spend on monitoring and enforcement. To get full use of this insight one needs to have auction procedures that provide incentives for truthful revelation of agents' private alternate incomes. Our second result is that the incentives for truthful revelation is lost when monitoring is incomplete unless the expected value of compliance exceeds the expected value of noncompliance. We demonstrate this result theoretically and through an economic experiment using an induced value reverse multi unit auction.
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| Tipo: |
Conference Paper or Presentation
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| Idioma: |
Inglês
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| Identificador: |
http://purl.umn.edu/115985
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| Relação: |
European Association of Agricultural Economists>2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland
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| Formato: |
12
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