In the context of public sector accountability, all four types of information asymmetries are likely. With respect to these four types, principal-agent theory argues that withholding information is intentional. Typically, hidden characteristics relate to incidents where the principal does not have sufficient ex ante knowledge about the agent, and therefore faces the risk of choosing one who will underperform (Picot, Reichwald & Wigand 2008, 48). With respect to public sector accountability, at least the following applications are feasible. Firstly, a task is assigned to an agent who has drawn too positive a picture of his or her abilities to perform a public service (e.g., in outsourcing arrangements). This information asymmetry is caused by the fact that agent has privileged information about his or her skills.