We analyze investment decisions when information is costly, with and without delegation to an agent. We use a rational …-inattention model and compare it with a canonical signal-extraction model. We identify three "investment conditions". In "sour …" conditions, no information is acquired and no investment made. In "sweet" conditions, investment is made "blindly", i.e. without …

current CEO who may have considerable power. Having signed a contract, the agent chooses how much effort to make to acquire … problem; how much information to acquire and what investment decision to make. As a consequence, the equilibrium contracts in … model E involve both bonuses and penalties. We identify lower and upper bounds on these, and study how the bonus and bonus …

exponential utility and cost of effort, each separating renegotiation-proof contract is characterized by a single "sensitivity …" parameter, which determines how the agent's promised utility varies with reported cash flows. The optimal contract among those …, and information revelation. -- Repeated Agency ; Asymmetric Information ; Persistent Information ; Contract Theory …

exponential utility and cost of effort, each separating renegotiation-proof contract is characterized by a single "sensitivity …" parameter, which determines how the agent's promised utility varies with reported cash flows. The optimal contract among those … information revelation. -- Repeated Agency ; Asymmetric Information ; Persistent Information ; Contract Theory ; Principal Agent …

exponential utility and cost of effort, each separating renegotiation-proof contract is characterized by a single “sensitivity …” parameter, which determines how the agent's promised utility varies with reported cash flows. The optimal contract among those …

We study SPACs in a continuous-time delegated investment model. Our model is built upon three unique features of SPACs … control over investment approval. Due to the misalignment in incentives, the sponsor has an increasing incentive to propose … control over investment approval reduces everyone’s welfare. This adverse effect is more pronounced if entrepreneurs …

weaker for managers with longer tenure. I consider an optimal incentive contract for money managers, and I provide an … compensation. In the optimal contract, flows become more sensitive to performance when the manager faces stronger incentives from … the compensation contract. With learning, the manager's incentives become stronger after good performance, so that a …