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A principal-agent model of sequential testing
Gerardi, Dino; Maestri, Lucas Jóver - In: Theoretical economics : TE ; an open access journal in … 7 (2012) 3, pp. 425-463
This paper analyzes the optimal provision of incentives in a dynamic information acquisition process. In every period, the agent can acquire costly information that is relevant to the principal's decision. Each signal may or may not provide definitive evidence in favor of the good state. Neither...
Persistent link: https://www.econbiz.de/10011689319
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Self-control, commitment and peer pressure : a laboratory experiment
Bonein, Aurélie; Denant-Boèmont, Laurent - In: Experimental economics : a journal of the Economic … 18 (2015) 4, pp. 543-568
Persistent link: https://www.econbiz.de/10011530674
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Social capital: a double-edged sword
Cole, Harold L.; Krueger, Dirk; Mailath, George J.; … - 2021
We analyze efficient risk-sharing arrangements when coalitions may deviate. Coalitions form to insure against idiosyncratic income risk. Self-enforcing contracts for both the original coalition and any deviating coalition rely on a belief in future cooperation which we term \social capital". We...
Persistent link: https://www.econbiz.de/10012438417
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Trust in risk sharing : a double-edged sword
Cole, Harold L.; Krueger, Dirk; Mailath, George J.; … - 2022
We analyze efficient risk-sharing arrangements when the value from deviating is determined endogenously by another risk sharing arrangement. Coalitions form to insure against idiosyncratic income risk. Self-enforcing contracts for both the original coalition and any coalition formed (joined)...
Persistent link: https://www.econbiz.de/10013555532
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Persuasion by dimension reduction
Malamud, Semyon; Schrimpf, Andreas - 2021 - This version: October 17, 2021
How should an agent (the sender) observing multi-dimensional data (the state vector) persuade another agent to take the desired action? We show that it is always optimal for the sender to perform a (non-linear) dimension reduction by projecting the state vector onto a lower-dimensional object...
Persistent link: https://www.econbiz.de/10012799529
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Delay and Learning in Coordination
Chamley, Christophe; Zhou, Zhen - 2021
This paper studies a coordination game with incomplete information and the option to delay. The delay option enables the agents to observe a binary signal depending on whether the early actions (e.g., investment) surpasses a threshold. The anticipation of information incentivizes agents to wait...
Persistent link: https://www.econbiz.de/10013219112
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Optimal transport of information
Malamud, Semyon; Cieślak, Anna; Schrimpf, Andreas - 2021 - This version: March 3, 2021
We study the general problem of Bayesian persuasion (optimal information design) with continuous actions and continuous state space in arbitrary dimensions. First, we show that with a finite signal space, the optimal information design is always given by a partition. Second, we take the limit of...
Persistent link: https://www.econbiz.de/10012487719
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Time-consistent optimal fiscal policy over the business cycle
Feng, Zhigang - In: Quantitative economics : QE ; journal of the … 6 (2015) 1, pp. 189-221
that abstract from history dependence. The welfare cost of no commitment is about 0. 22% of aggregate consumption as … compared to the Ramsey allocation with full commitment. …
Persistent link: https://www.econbiz.de/10011757665
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Time-Consistent Implementation in Macroeconomic Games
Barthelemy, Jean; Mengus, Eric - 2022
The commitment ability of governments is neither infinite nor zero but intermediate. In this paper, we determine the … commitment ability that a government needs to implement a unique equilibrium outcome and rule out undesired self …-consistent equilibrium with any low level of commitment ability. We then show that this result may not be robust to imperfect information …
Persistent link: https://www.econbiz.de/10014264548
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Time-consistent implementation in macroeconomic games
Barthélémy, Jean; Mengus, Eric - In: Theoretical economics : TE ; an open access journal in … 19 (2024) 3, pp. 1151-1184
The commitment ability of governments is neither infinite nor zero but intermediate. In this paper, we determine the … commitment ability that a government needs to implement a unique equilibrium outcome and rule out self-fulfilling expectations … level of commitment ability. We finally derive implications for models of bailouts and capital taxation. …
Persistent link: https://www.econbiz.de/10014635394