Asymmetry of Information in Public Finance

Abstract

A large and interesting class of problems in economics involves delegated choices in which one individual or organisation has the responsibility for taking decisions in the interest of one or more others. A usual claim in economics is that an optimum exists because each agent realises that he could not do better for himself than by accepting the prevailing settings and maximising his objective function using those constraints.

would like to thank Prof. R. R. Barnett, Prof. P. Simmons, and P. C. Smith for their invaluable help.