Competing Mechanism Games of Moral Hazard: Communication and Robustness
Attar AndreaCampioni EloisaPiaser GwenaelRajan Uday
CEIS Research Paper
We consider multiple-principal multiple-agent models of moral hazard: principals compete through mechanisms in the presence of agents who take unobservable actions. In this context, we provide a rationale for restricting principals to make use of simple mechanisms, which correspond to direct mechanisms in the standard framework of Myerson (1982). Our results complement those of Han (2007) who analyzes a complete information setting where agents’ actions are fully contractible.
Number: 196
Keywords: Moral hazard, multiple-principal multiple-agent, simple mechanisms
JEL codes: D82, D86
Date: Friday, June 10, 2011
Revision Date: Friday, June 10, 2011