Moral hazard (extra)

Economic theory, the potential for moral hazard and risk costs because the parties feel that the parties tend to be risk situation. In other words, it is a potential risk that the cost and burden of others, in whole or in part, mediated by know that, more willing to take risks that trend. Financial transactions are carried out either party's behavior may change after another disadvantage where moral hazard may occur.For individuals and institutions to take responsibility and complete results of their actions, leaving another party to hold some responsibility for the result of these actions, it is larger than that in the case of the other carefully too does not have a tendency to act now, moral hazard occurs.
Economists explain moral hazard as a special case situation of information asymmetry, one party in a transaction that has more information than others. If the parties are insulated from the risk, have detailed information about the intent and action from the party paying for the negative consequences of risk, in particular, can moral hazard occurs. More broadly, moral hazard can occur if you have an incentive trends and misbehaving from the point of view of the party less information is against the more information about the behavior and intentions.