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Moral Hazard, Targeting and Contract Duration in Agri-Environmental Policy

Fraser, Robert (2012) Moral Hazard, Targeting and Contract Duration in Agri-Environmental Policy. Journal of Agricultural Economics, 63 (1). pp. 56-64. ISSN 0021-857X. (doi:10.1111/j.1477-9552.2011.00327.x) (The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided) (KAR id:40505)

The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided. (Contact us about this Publication)
Official URL
http://dx.doi.org/10.1111/j.1477-9552.2011.00327.x

Abstract

This article extends the multi-period agri-environmental contract model of Fraser (Journal of Agricultural Economics, Vol. 55, (2004) pp. 525–540) to include a more realistic specification of the inter-temporal penalties for non-compliance, and therefore of the inter-temporal moral hazard problem in agri-environmental policy design. It is shown that a farmer has an unambiguous preference for cheating early over cheating late in the contract period based on differences in the expected cost of compliance. It is then shown how the principal can make use of this unambiguous preference to target monitoring resources intertemporally, and in so doing, to encourage full contract duration compliance.

Item Type: Article
DOI/Identification number: 10.1111/j.1477-9552.2011.00327.x
Additional information: number of additional authors: 0;
Uncontrolled keywords: Agri-environmental policy; contract duration; moral hazard; targeting D86; Q18; Q58
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Stewart Brownrigg
Date Deposited: 07 Mar 2014 00:05 UTC
Last Modified: 29 May 2019 12:26 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/40505 (The current URI for this page, for reference purposes)
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