Ex ante contracting with endogenously determined communication plans
AbstractIn this paper we introduce a new model of ex ante contracting for economies with asymmetric information to examine endogenously determined communication plans for information sharing in the interim stage. In contrast to the models used in previous research, in the present model agents negotiate not only on a contract of state contingent allocations but also on a communication plan, a set of rules describing how agents will reveal part of their private information at the interim stage to execute the trade contracts. We prove a result about the nested structure of the set of allocations implementable by various communication plans and establish the existence of core strategies for this cooperative game under various regularity conditions.
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Bibliographic InfoArticle provided by Springer in its journal Economic Theory.
Volume (Year): 18 (2001)
Issue (Month): 2 ()
Note: Received: 4 March 1998; revised version: 17 September 1999
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Web page: http://link.springer.de/link/service/journals/00199/index.htm
Find related papers by JEL classification:
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
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