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Q. Example on Uncertainty and the policy process?
For example, if it is expected that current government will be replaced in upcoming election, and the next government will be having a different set of policy preferences, expectations on the performance of the current policy may become higher. The process becomes move complicated when current policy and its performance is used to decide the probability of success of the present government in upcoming elections. With uncertainty about the future policy, the policy outcome relation may become quite complex. Thus under symmetric incomplete information the dynamic feedback due to uncertainty severely complicates the effects of policy on its outcome. Matter is complicated further when we assume incomplete information to be asymmetric. Uncertainty about future public policy gives rise to a complex dynamical system.
As you know, the principal-agent problem stress the effect of asymmetric information between the principal and the agents on economic outcomes, the equilibrium in a principal-agent
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A change in the legal statute may be able to force an equilibrium if it leads to a new equilibrium which implies some revised belief which sustains the equilibrium. Tirole (1996)
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Question: Awards for excellent performance are increasingly employed within the public service in many countries. These will or will not have a financial value. Performance-rel
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