Multiple Lending and Constrained Efficiency in the Credit Market

In this paper we present a model of credit market with several homogeneous lenders competing to finance an investment project. Contracts are non-exclusive, hence the borrower can accept whatever subset of the offered loans. We use the model to discuss efficiency issues in competitive economies with asymmetric information and non-exclusive agreements. We characterize the equilibria of this common agency game with moral hazard and show that they all belong to the constrained Pareto frontierCommon Agency; Moral Hazard; Parto Efficiency; Second Best

Multiple Lending and Constrained Efficiency in the Credit Market

This paper studies the relationship between competition and incentives in an economy with financial contracts. We concentrate on non-exclusive credit relationships, those where an entrepreneur can simultaneously accept more than one contractual offer. Several homogeneous lenders compete on the contracts they offer to finance the entrepreneur's investment project. We model a common agency game with moral hazard, and we characterize its equilibria. As expected, notwithstanding the competition among the principals (lenders), non-competitive outcomes can be supported. In particular, positive profit equilibria are pervasive. We then provide a complete welfare analysis and show that all equilibrium allocations turn out to be constrained Pareto efficient.Common Agency, Financial Markets, Efficiency

On multiple agent models of moral hazard

In multiple principal, multiple agent models of moral hazard, we provide conditions under which the outcomes of equilibria in direct mechanisms are preserved when principals can offer indirect communication schemes. We discuss the role of random allocations and recommendations and relate the result to the existing literature.Moral Hazard, Multiple Agents, Direct Mechanism.

Additive manufacturing of reconstruction devices for maxillofacial surgery: design and accuracy assessment of a mandibular plate prototype

Additive manufacturing (AM) presents unique opportunities for medical applications and in particular in maxillofacial surgery for developing patient specific implants. The quality assessment of additive manufactured products is an essential aspect for the real introduction in health services. In this framework, the purpose of the present study is to investigate the possibility of developing prototypes of mandibular plates as preoperative surgical planning models, by verification of design, analysis of internal structure integrity and evaluation of the effects of variables involved in AM processes. A PolyJet threedimensional (3D) printing system is used in the study due to its very fine resolution. The computer aided design (CAD) models of the implants were converted to stereolithography (STL) file formats in different STL conversion resolutions and then printed using commercial prototyping polymers to observe the effect of model resolution. Finite element analysis (FEA) was conducted to study the capability of the designed mandibular plate to support the involved biomechanical loads. Micro-computed tomography (micro-CT) analysis was performed to verify the dimensions and the internal defects of the printed objects, considering that the presence of defects can affect the quality and compromise the final performance. Results were analyzed to understand the effect of the 3D printing process flow conditions on the obtained prototypes. Relative error in reference to the CAD models mainly evidenced the difference in resolution due to STL files and the effect of the design. No anomalies and defects were detected inside the evaluated samples

On Private Communication in Competing Mechanism Games

We study competing mechanism games in which principals simultaneously design contracts to deal with several agents. We show that principals can profit from privately communicating with agents by generating incomplete information in the continuation game they play. Specifically, we construct an example of a complete information game in which none of the (multiple) equilibria in Yamashita (2010) survives against unilateral deviations to mechanisms involving private communication. This also contrasts with the robustness result established by Han (2007). The role of private communication we document may call for extending the standard construction of Epstein and Peters (1999) to incorporate this additional element

Private Communication in Competing Mechanism Games

We study games in which principals simultaneously post mechanisms in the presence of several agents. We evaluate the role of principals’ communication in these settings. As in Myerson (1982), each principal may generate incomplete information among agents by sending them private signals. We show that this channel of communication, which has not been considered in standard approaches to competing mechanisms, has relevant strategic effects. Specifically, we construct an example of a complete information game in which (multiple) equilibria are sustained as in Yamashita (2010) and none of them survives in games in which all principals can send private signals to agents. The corresponding sets of equilibrium allocations are therefore disjoint. The role of private communication we document may hence call for extending the construction of Epstein and Peters (1999) to incorporate this additional element

On Competing Mechanisms under Exclusive Competition

We study games in which several principals design incentive schemes in the presence of privately informed agents. Competition is exclusive: each agent can participate with at most one principal, and principal-agents corporations are isolated. We analyze the role of standard incentive compatible mechanisms in these contexts. First, we provide a clarifying example showing how incentive compatible mechanisms fail to completely characterize equilibrium outcomes even if we restrict to pure strategy equilibria. Second, we show that truth-telling equilibria are robust against unilateral deviations toward arbitrary mechanisms. We then consider the single agent case and exhibit sufficient conditions for the validity of the revelation principle