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Information Design with Agency

Author

Listed:
  • Jacopo Bizzotto

    (OsloMet - Oslo Metropolitan University)

  • Eduardo Perez-Richet

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, CEPR - Center for Economic Policy Research - CEPR)

  • Adrien Vigier

    (BI Norwegian Business School [Oslo])

Abstract

We consider a general information design problem in which the task of running a procedure generating information for a continuation game is performed by an agent. A moral hazard problem therefore emerges in which the principal faces a trade-off between generating information that is persuasive in the continuation game, and efficiently incentivizing the agent to comply with the procedure designed. Standard concavification techniques do not apply in this environment. We provide a general methodology to tackle such problems, and examine the way in which moral hazard affects the optimal procedure of the principal.

Suggested Citation

  • Jacopo Bizzotto & Eduardo Perez-Richet & Adrien Vigier, 2020. "Information Design with Agency," SciencePo Working papers Main hal-03874017, HAL.
    • Handle: RePEc:hal:spmain:hal-03874017
    Note: View the original document on HAL open archive server: https://hal-sciencespo.archives-ouvertes.fr/hal-03874017
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Information Design; Moral Hazard; Agency Cost; Information Acquisition;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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