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Persuasion and dynamic communication
Sher, Itai - In: Theoretical Economics 9 (2014) 1, pp. 99-136
A speaker attempts to persuade a listener to accept a request by presenting evidence. A persuasion rule specifies what evidence is persuasive. This paper compares static and dynamic rules. We present a single linear program (i) whose solution corresponds to the listener's optimal dynamic rule...
Persistent link: https://www.econbiz.de/10011599506
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Price discrimination through communication
Sher, Itai; Vohra, Rakesh - In: Theoretical Economics 10 (2015) 2, pp. 597-648
We study a seller's optimal mechanism for maximizing revenue when a buyer may present evidence relevant to her value. We show that a condition very close to transparency of buyer segments is necessary and sufficient for the optimal mechanism to be deterministic--hence akin to classic third...
Persistent link: https://www.econbiz.de/10011599549
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A theory of personal budgeting
Galperti, Simone - In: Theoretical Economics 14 (2019) 1, pp. 173-210
-specific budgets depends on the combination of a demand for commitment and the demand for flexibility resulting from uncertainty about … with minimum-savings rules (another widely-studied form of commitment), and how budgeting depends on the intensity of self …
Persistent link: https://www.econbiz.de/10012215309
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Costly miscalibration
Guo, Yingni; Shmaya, Eran - In: Theoretical Economics 16 (2021) 2, pp. 477-506
the platform's forecast; when the miscalibration cost is high, the platform can achieve its commitment payoff in an … equilibrium, and the only extensive-form rationalizable strategy of the platform is its strategy in the commitment solution. Our … results show that miscalibration cost is a proxy for the degree of the platform's commitment power, and thus provide a …
Persistent link: https://www.econbiz.de/10013189059
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Delegating learning
Escobar, Juan F.; Zhang, Qiaoxi - In: Theoretical Economics 16 (2021) 2, pp. 571-603
Learning is crucial to organizational decision making but often needs to be delegated. We examine a dynamic delegation problem where a principal decides on a project with uncertain profitability. A biased agent, who is initially as uninformed as the principal, privately learns the profitability...
Persistent link: https://www.econbiz.de/10013189076
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Persuasion and dynamic communication
Sher, Itai - In: Theoretical Economics 9 (2014) 1
A speaker attempts to persuade a listener to accept a request by presenting evidence. A persuasion rule specifies what evidence is persuasive. This paper compares static and dynamic rules. We present a single linear program (i) whose solution corresponds to the listener's optimal dynamic rule...
Persistent link: https://www.econbiz.de/10010738407
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Price discrimination through communication
Sher, Itai; Vohra, Rakesh - In: Theoretical Economics 10 (2015) 2
We study a seller's optimal mechanism for maximizing revenue when a buyer may present evidence relevant to her value. We show that a condition very close to transparency of buyer segments is necessary and sufficient for the optimal mechanism to be deterministic--hence akin to classic third...
Persistent link: https://www.econbiz.de/10010777681
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Optimal delegated search with adverse selection and moral hazard
Ulbricht, Robert - In: Theoretical Economics 11 (2016) 1, pp. 253-278
The paper studies a model of delegated search. The distribution of search revenues is unknown to the principal and has to be elicited from the agent in order to design the optimal search policy. At the same time, the search process is unobservable, requiring search to be self-enforcing. The two...
Persistent link: https://www.econbiz.de/10011599569
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A general solution method for moral hazard problems
Ke, Rongzhu; Ryan, Christopher Thomas - In: Theoretical Economics 13 (2018) 3, pp. 1425-1481
Principal-agent models are pervasive in theoretical and applied economics, but their analysis has largely been limited to the ``first-order approach'' (FOA) where incentive compatibility is replaced by a first-order condition. This paper presents a new approach to solving a wide class of...
Persistent link: https://www.econbiz.de/10012010060
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A unifying approach to incentive compatibility in moral hazard problems
Kirkegaard, René - In: Theoretical Economics 12 (2017) 1, pp. 25-51
A new approach to moral hazard is presented. Once local incentive compatibility is satisfied, the problem of verifying global incentive compatibility is shown to be isomorphic to the problem of comparing two classes of distribution functions. Thus, tools from choice under uncertainty can be...
Persistent link: https://www.econbiz.de/10012010062