Objective
The project will focus on the analysis of financial constraints from a normative standpoint. We will characterize the optimal financial contract when the social value of investment exceeds the private value. If the ex post revenues are privately observed by firms, the threat to terminate funding solves the agency issue. Then, there is a trade-off between inducing truth reporting and realizing socially valuable investments. Therefore, from a welfare perspective, it may be optimal to provide a "long purse" to firms even in this context. We will analyze not only the optimal level of funds but also the structure of financing. For that purpose, we have to address the issue of the existence of multiple creditors. The recent insights of the multiprincipal theory will be used to derive the results. We will apply this analysis to the European economic policies concerning the financing of less-favored areas and the investments of multinational firms engaged in imperfect competition.
Fields of science (EuroSciVoc)
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Programme(s)
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
Topic(s)
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Call for proposal
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
Data not available
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
Funding Scheme
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
Coordinator
LONDON
United Kingdom
The total costs incurred by this organisation to participate in the project, including direct and indirect costs. This amount is a subset of the overall project budget.