Abstract :
The setofincentive-feasibleallocationsisexaminedinadynamicquasi-linear
environmentwhereagentslackcommitmentandhaveprivateinformationovertheir
idiosyncraticcharacteristics.Whenrecord-keepingisavailable,thefirst-bestallocation
is implementableinasetofsufficientlypatienteconomies.Whenrecord-keepingis
limited toonemoney,thissetisstrictlysmaller—exceptwhenprivateinformationis
absent.Whenrecord-keepingisexpanded,butlimitedtotwomonies,thesetof
economiesforwhichthefirst-bestisimplementablecorrespondstothatofrecord-
keeping,evenwhenprivateinformationispresent.Wefurtherdemonstratethattwo
moniesareaperfectsubstituteforrecord-keeping
