collusion and capture between middle managers and line workers; provided that this detrimental form of collusion takes place in … of a collusive agreement a party has to incur to walk away from such a side deal. Delegation is then a simple way for the … principal to compensate the uninformed colluding party for walking out of collusion and for using/reporting the information …

This paper studies the optimal design of delegation rule in a three-tier principal–intermediary–agent hierarchy. In … this hierarchy, monetary transfer is not feasible, delegation is made sequentially, and all players are strategic. We … characterize the optimal delegation mechanism. It is shown that the single-interval delegation a la Holmstrom is optimal only when …

termination threats make collusion supportable at any discount factor, independent of contracts’ duration. When managers have …

-employee relationship. We study a model of delegation with an informed agent, where the principal may impose money-burning on the agent as a … some results novel to the delegation literature. First, money-burning is more likely if the principal is more sensitive to …

Supplementary Appendix to "Delegation and Nonmonetary Incentives."The paper "Delegation and Nonmonetary Incentives" to …