Learning is crucial to organizational decision making but often needs to be delegated. We examine a dynamic delegation … the principal, privately learns the profitability over time and communicates to the principal. We formulate learning … delegation as a dynamic mechanism design problem and characterize the optimal delegation scheme. We show that private learning …

and public signals. We show that competition leads the two firms to invest too early and analyse collusion schemes whereby … firm must transfer a large part of the surplus to the inactive firm in order to limit pre-emption. Learning; Pre …