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Strategic delegation in experimental markets

Huck, Steffen; Müller, Wieland; Norman, Hans-Theo - 2000

In this experiment, we analyze strategic delegation in a Cournot duopoly. Owners can choose among two different … contracts which determine their managers' salaries. One contract simply gives managers incentives to maximize firm profits … only rarely chosen in the experimental markets. This behavior is rational given that managers do not play according to the …

Persistent link: https://www.econbiz.de/10009781566

Control aversion in hierarchies

De Chiara, Alessandro; Engl, Florian; Herz, Holger; … - 2022

Companies typically control various aspects of their workers' behaviors. In this paper, we investigate whether the hierarchical distance of the superior who imposes such control measures matters for the workers' ensuing reaction. In particular, we test, in a laboratory experiment, whether...

Persistent link: https://www.econbiz.de/10013255629

Imitation : theory and experimental evidence

Alpesteguia, Jose; Huck, Steffen; Oechssler, Joerg - 2003

We introduce a generalized theoretical approach to study imitation models and subject themodels to rigorous experimental testing. In our theoretical analysis we find that the differentpredictions of previous imitation models are due to different informational assumptions, notto different...

Persistent link: https://www.econbiz.de/10011509505

Merger without cost advantages

Huck, Steffen (contributor); Konrad, Kai A. (contributor); … - 2005

The seminal paper by Salant, Switzer and Reynolds (1983) showed that merger in a standard Cournot framework with linear demand and linear costs is not profitable unless a large majority of the firms are involved in the merger. However, many strategic aspects matter for firm competition such as...

Persistent link: https://www.econbiz.de/10002757958

Induced price leadership and (counter-)spying rivals' play under incomplete information

Fan, Cuihong; Chŏn, Pyŏng-hŏn; Wolfstetter, Elmar - 2019

We analyze spying out a rival's price in a Bertrand market game with incomplete information. Spying transforms a simultaneous into a robust sequential moves game. We provide conditions for profitable espionage. The spied at firm may attempt to immunize against spying by delaying its pricing...

Persistent link: https://www.econbiz.de/10011962353

Common agency equilibria with discrete mechanisms and discrete types

Martimort, David; Stole, Lars A. - 2001

This paper characterizes the equilibrium sets of an intrinsic common agencygame with discrete types and direct revelation mechanisms. After presentinga general algorithm to find the pure-strategy equilibria of this game, we use itto characterize these equilibria when the two principals control...

Persistent link: https://www.econbiz.de/10011400396

Flexible contracts

Gottardi, Piero; Tallon, Jean-Marc; Ghirardato, Paolo - 2010

This paper studies the costs and benefits of delegating decisions to superiorly informed agents relative to the use of rigid, non discretionary contracts. Delegation grants some flexibility in the choice of the action by the agent, but also requires the use of an appropriate incentive contract...

Persistent link: https://www.econbiz.de/10003936681

Incentives, reputation and the allocation of authority

Englmaier, Florian; Filipi, Ales; Singh, Ravi - 2010

principal may delegate additional authority in order to screen for managers of high ability. -- agency problems ; delegation …

Persistent link: https://www.econbiz.de/10003942661

Delegation and interim performance evaluation

Schütte, Miriam; Wichardt, Philipp C. - 2013 - This Version: March 22, 2013

This paper considers the effects of an interim performance evaluation on the decision of a principal to delegate authority to a potentially biased but better informed agent. Assuming the agents ́outside option to be determined by market beliefs about their type, interim evaluations (a) provide...

Persistent link: https://www.econbiz.de/10009730547

Delegation and dynamic incentives

Shin, Dongsoo; Strausz, Roland - 2014

Using an agency model, we show how delegation, by generating additional private information, improves dynamic incentives under limited commitment. It circumvents ratchet effects and facilitates the revelation of persistent private information through two effects: a play-hardball effect, which...

Persistent link: https://www.econbiz.de/10010347364

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