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as an independent profit center that contracts with the parent firm as well as the supplier. The delegation of decision … can claim from the supplier. To identify the role of delegation, we focus instead on two games. Both games have a … continuum of equilibria, which we compare to the set of incentive efficient equilibria of the initial no-delegation bargaining …
Persistent link: https://www.econbiz.de/10005328937
We study a model of civil dispute with delegation in which a plaintiff's lawyer works on a contingent fee basis but a … defendant's lawyer on an hourly fee basis. We first derive the conditions under which delegation to the lawyers brings both the … plaintiff and defendant more payoffs, compared to the case of no delegation. We then show: (i) one third of the award as a …
Persistent link: https://www.econbiz.de/10005342327
outside evaluator cannot observe the allocation of authority. Hence, delegation can provide a way to manipulate the principal …'s ex post reputation. In general, the principal keeps the authority too often when she has the opportunity of delegation …
Persistent link: https://www.econbiz.de/10005130229
particular, can an agent increase her payoff in a cheap-talk game by delegating to others to play on her behalf? This paper shows … that such profitable delegation is possible and characterizes the agents to whom a given agent may delegate the …
Persistent link: https://www.econbiz.de/10005130238
organization, employ subordinates and contract with external suppliers. This paper explains when such delegation of authority can … two two-tier hierarchies, the principal designs contracts for both agents. In delegation with a three-tier hierarchy, the … where the principal can benefit from delegating authority to the manager, but not to the worker. Beneficial delegation …
Persistent link: https://www.econbiz.de/10005063551
This paper is about freedom of choice and rigidity of choice rules as incentive devices. We study the optimal design of an agent's freedom of choice when his information is endogenous and costly to acquire. We show that curtailing the agent's authority over decision-making may be optimal even if...
Persistent link: https://www.econbiz.de/10005063595
This paper considers the possibility that a seller can contract with one uninformed buyer prior to an auction involving two potential buyers. In a more general setting than previous literature, strategic ex-ante contracts not only extract rent from entrants, but could also mitigate the...
Persistent link: https://www.econbiz.de/10005130202