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Browsing by Author "Ma, Ching-to Albert"
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Item Incentives for motivated experts in a partnership(Elsevier, 2018-08) Liu, Ting; Ma, Ching-to Albert; Mak, Henry Y.; Economics, School of Liberal ArtsA Principal has a set of projects, each having different benefit potentials, and each requiring a basic technology from one of two experts and time inputs from both experts. Experts enjoy motivation utilities from production, but have private information of their own motivation preferences and project potentials. Technology and time-input choices are experts’ private decisions. Experts form a Partnership, which designs a sharing rule and a gatekeeping protocol to determine experts’ priority on technology choice. Using a linear cost-share contract that lets experts make minimum profits, the Principal implements the first best by delegating all decisions to the Partnership.Item Information Disclosure and the Equivalence of Prospective Payment and Cost Reimbursement(Elsevier, 2015-09) Ma, Ching-to Albert; Mak, Henry Y.; Department of Economics, School of Liberal ArtsA health care provider chooses unobservable service-quality and cost-reduction efforts. The efforts produce quality and cost efficiency. An insurer observes quality and cost, and chooses how to disclose this information to consumers. The insurer also decides how to pay the provider. In prospective payment, the insurer fully discloses quality, and sets a prospective payment price. In cost reimbursement, the insurer discloses a value index, a weighted average of quality and cost efficiency, and pays a margin above cost. The first-best quality and cost efforts can be implemented by prospective payment and by cost reimbursement. Cost reimbursement with value index eliminates dumping and cream skimming. Prospective payment with quality index eliminates cream skimming.