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Garrett, Daniel F.
(2021)
Payoff implications of incentive contracting.
Theoretical Economics, vol. 16 (n° 4).
pp. 1281-1312.
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Abstract
In the context of a canonical agency model, we study the payoff implications of introducing optimally-structured incentives. We do so from the perspective of an analyst who does not know the agent's preferences for responding to incentives, but does know that the principal knows them. We provide, in particular, tight bounds on the principal's expected benefit from optimal incentive contracting across feasible values of the agent's expected rents. We thus show how economically relevant predictions can be made robustly given ignorance of a key primitive.
| Item Type: | Article |
|---|---|
| Language: | English |
| Date: | November 2021 |
| Refereed: | Yes |
| Place of Publication: | New York. |
| Uncontrolled Keywords: | Asymmetric information, mechanism design, robustness, procurement |
| JEL Classification: | D82 - Asymmetric and Private Information |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Site: | UT1 |
| Date Deposited: | 09 Dec 2021 14:47 |
| Last Modified: | 01 Feb 2022 12:52 |
| OAI Identifier: | oai:tse-fr.eu:125557 |
| URI: | https://publications.ut-capitole.fr/id/eprint/43510 |
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Payoff implications of incentive contracting. (deposited 09 Sep 2020 13:46)
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