Decision Rules and Optimal Delegation of Information Acquisition
The paper analyzes the relationship between decision rules and information acquisition in decision-making processes. The setting under consideration is one where information acquisition and decision making are assigned to different agents and the decision-maker's preferences are not observable. The paper argues that the choice of the optimal organizational structure at the information acquisition stage depends on the degree of discretion granted to the decision-maker. High discretion ensures more flexibility but requires that information acquisition is assigned to the parties directly involved in the decision. Since they have conflicting interests, the parties provide a check against abusive decisions although at the cost of information manipulation. Low discretion introduces rigidity but allows the delegation of information acquisition to an unbiased agent who ensures truthful reports. Which of these two "optimal combinations" is preferable is then shown to depend on the probability of finding information when an agent searches. Our analysis sheds light on the stylized fact that Civil Law systems are generally associated with inquisitorial procedures whereas Common Law systems are combined with adversarial procedures.
|Date of creation:||01 May 2000|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +39 081 - 675372
Fax: +39 081 - 675372
Web page: http://www.csef.it/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lipman Barton L. & Seppi Duane J., 1995. "Robust Inference in Communication Games with Partial Provability," Journal of Economic Theory, Elsevier, vol. 66(2), pages 370-405, August.
- Gilbert, Richard J. & Newbery, David M., 1988.
Department of Economics, Working Paper Series
qt50s6h8c6, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Giuliana Palumbo, 2004.
"Optimal Duplication of Effort in Advocacy Systems,"
Temi di discussione (Economic working papers)
502, Bank of Italy, Economic Research and International Relations Area.
- Song Shin, H, 1996.
"Adversarial and Inquisitorial Procedures in Arbitration,"
124, Economics Group, Nuffield College, University of Oxford.
- Hyun Song Shin, 1998. "Adversarial and Inquisitorial Procedures in Arbitration," RAND Journal of Economics, The RAND Corporation, vol. 29(2), pages 378-405, Summer.
- Shin, Hyun Song, 1997. "Adversarial and Inquisitorial Procedures in Arbitration," CEPR Discussion Papers 1722, C.E.P.R. Discussion Papers.
- Jean Tirole, 1999. "Incomplete Contracts: Where Do We Stand?," Econometrica, Econometric Society, vol. 67(4), pages 741-782, July.
- Laffont, Jean-Jacques & Tirole, Jean, 1990. "The Politics of Government Decision Making: Regulatory Institutions," Journal of Law, Economics and Organization, Oxford University Press, vol. 6(1), pages 1-31, Spring.
- Laffont, Jean-Jacques & Tirole, Jean, 1991.
"The Politics of Government Decision-Making: A Theory of Regulatory Capture,"
The Quarterly Journal of Economics,
MIT Press, vol. 106(4), pages 1089-127, November.
- Jean-Jacques Laffont & Jean Tirole, 1988. "The Politics of Government Decision-Making: A Theory of Regulatory Capture," Working papers 506, Massachusetts Institute of Technology (MIT), Department of Economics.
- Jean-Jacques LAFFONT & Jean TIROLE, 1990. "The Politics of Government Decision-Making : a Theory of Regulatory Capture," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 9004, Université de Lausanne, Faculté des HEC, DEEP.
- Kydland, Finn E & Prescott, Edward C, 1977. "Rules Rather Than Discretion: The Inconsistency of Optimal Plans," Journal of Political Economy, University of Chicago Press, vol. 85(3), pages 473-91, June.
When requesting a correction, please mention this item's handle: RePEc:sef:csefwp:42. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lia Ambrosio)
If references are entirely missing, you can add them using this form.