Keeping the Agents in the Dark: Private Disclosures in Competing Mechanisms

We study games in which several principals contract with privately-informed agents. show that enabling the to engage contractible private disclosures – by sending signals agents about how mechanisms will respond agents’ messages can significantly affect predictions of such games. Our first result shows may generate equilibrium outcomes cannot be supported any game without disclosures, no matter richness message spaces and availability public randomizing devices. The thus challenges canonicity universal Epstein Peters (1999). Our second need not sustainable when are allowed. robustness “folk theorems” Yamashita (2010) Troncoso-Valverde (2013). These findings call for a novel approach analysis competing-mechanism