Master
2024/2025
Contract Theory
Type:
Compulsory course (Data Analytics for Business and Economics)
Area of studies:
Economics
Delivered by:
Department of Economics
When:
2 year, 1, 2 module
Mode of studies:
offline
Open to:
students of one campus
Instructors:
Sergey G. Kokovin
Master’s programme:
Data Analytics for Business and Economics
Language:
English
ECTS credits:
3
Contact hours:
24
Course Syllabus
Abstract
This course provides an overview of the classical as well as advanced topics in contract theory. We are going to start with the classical principal-agent models of screening and moral hazard and learn how managers create incentives for their employees. These models involve two parties: a principal (e.g. manager) and an agent (e.g. employee). The principal delegates a task to the agent by offering him a contact. In the moral hazard problem, the agent's actions are hidden (noncontractible), yet they affect an outcome that can be included in a contract. In the screening problem, the agent has some private information relevant to the task. In both problems, asymmetric information creates inefficiency. In the second part of the course we consider various extensions of these two problems to many agents and dynamic environment. At the end of the course we'll shift gears to a different area of market design and learn how to get married (matching theory).