Solved: Sri lanka government awarded contracts to private companies, Public Economics

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Sri lanka government awarded contracts to private companies

Question:

Suppose the Sri Lanka government awarded contracts to private companies to rebuild the countrys infrastructure damaged by the tsunami and it based its contracts on a percentage of the cost of the reconstruction. Would this constitute a moral hazard? If so, what would the government need to do to prevent such a problem?

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Public Economics: Sri lanka government awarded contracts to private companies

Reference No:- TGS02093963

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