Contracting for Information under Imperfect Commitment
نویسندگان
چکیده
We study optimal contracting under imperfect commitment in a model with an uninformed principal and an informed agent. The principal can commit to pay the agent for his advice but retains decision-making authority. Under an optimal contract, the principal should (a) never induce the agent to fully reveal what he knows even though this is feasible and (b) never pay the agent for imprecise information. We compare optimal contracts under imperfect commitment to those under full commitment as well as to delegation schemes. We nd that gains from contracting are greatest when the divergence in the preferences of the principal and the agent is moderate. JEL Classi cation D23, D82. This research was supported by the National Science Foundation (SES-0095639). We thank Ernesto Dal Bó, Massimo Morelli as well as various seminar participants for helpful comments.
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