A model intervenes: the many faces of moral hazard

Latsis, John and Repapis, Constantinos. 2014. A model intervenes: the many faces of moral hazard. Cambridge Journal of Economics, 38(4), pp. 743-760. ISSN 0309-166X [Article]

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Abstract or Description

This article builds on advances in social ontology to develop a new understanding of how mainstream economic modelling affects reality. We propose a new framework for analysing and describing how models intervene in the social sphere. This framework allows us to identify and articulate three key epistemic features of models as interventions: specificity, portability and formal precision. The second part of the article uses our framework to demonstrate how specificity, portability and formal precision explain the use of moral hazard models in a variety of different policy contexts, including worker compensation schemes, bank regulation and the euro-sovereign debt crisis.

Item Type:


Identification Number (DOI):



Models, Theory, Policy interventions, Moral hazard

Departments, Centres and Research Units:

Institute of Management Studies


July 2014Published
11 December 2013Published Online

Item ID:


Date Deposited:

07 Sep 2015 12:22

Last Modified:

14 May 2020 15:30

Peer Reviewed:

Yes, this version has been peer-reviewed.



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