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Take the contract pair ((H_{oo},L_{oo})) in Fig. 12. Suppose a single insurer, say insurer 1, is offering contract (H_{oo}) and the rest of insurers offer contract (L_{oo}).
((H_{oo}, L_{oo})) is an equilibrium set of contracts as long as (i) only Firm 1 offers (H_{oo}); (ii) a number of firms (M_{L} > 2) offer contract (L_{oo}); (iii) ML is small enough that each firm offering (L_{oo}) shares a fraction of total industry profits at (L_{oo}), which is at least as large as the profits obtained by Firm 1.
Due to the constant returns to scale, the equilibrium can be sustained with (Mge 3) number of insurers offering any of the two contracts as long as at least 2 offer contract (L^{RS}).
There are companies like A Hire Authority that offer contract recruiting services for large and small companies.
The Mets have made a dangerous decision by refusing to offer contract extensions to Valentine and General Manager Steve Phillips.
The rest of insurers offer contract (L_{np}).
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com