Delegated monitoring versus arm's-length contracting
نویسندگان
چکیده
منابع مشابه
Public Contracting in Delegated Agency
We study games of public delegated common agency under asymmetric information. Using tools from non-smooth analysis and optimal control, we derive best responses and characterize equilibria (both continuous and discontinuous) using self-generating optimization programs of which any equilibrium allocation must be a solution. Special attention is given to common agency games in which each princip...
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In a typical corporate hierarchy, the manager is delegated the authority to make strategic decisions, and to contract with other employees. We study when such delegation can be optimal. In centralization, the owner retains the authority, which fails to motivate the manager to acquire valuable information, leading to suboptimal decisions and inefficient incentive provision to the worker. Benefic...
متن کاملPublic Contracting in Delegated Agency Games
This paper studies games of delegated common agency under asymmetric information. Using tools from non-smooth analysis and control, we derive best responses and equilibria under weak conditions on equilibrium schedules. Inefficiencies in equilibrium arise from two sources: inefficient contracting by a given coalition of active principals and inefficient participation (insufficient activity) by ...
متن کاملContracting in Delegated Portfolio Management: The Case of Alternative Assets
This study explores the implications of portfolio opacity for the design of asset management contracts. This is a case of particular interest given the growing importance of ‘alternative’ assets like hedge funds and private equity funds in institutional portfolios. The alternative assets are often characterized by relatively illiquid or non-publicly traded holdings, proprietary strategies, and ...
متن کاملA Dynamic Game under Ambiguity: Contracting for Delegated Experimentation
Conventional (single-prior) Bayesian games of incomplete information are limited in their ability to capture the extent of informational asymmetry. In particular, they are not capable of representing complete ignorance of an uninformed player about an unknown parameter of the environment. Using a framework of contracting for delegated experimentation, we formulate and analyze a dynamic game of ...
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ژورنال
عنوان ژورنال: International Journal of Industrial Organization
سال: 2004
ISSN: 0167-7187
DOI: 10.1016/j.ijindorg.2004.04.004