zbMATH — the first resource for mathematics

Role of linking mechanisms in multitask agency with hidden information. (English) Zbl 1203.91070
Summary: We investigate the adverse selection problem where a principal delegates multiple tasks to an agent. We characterize the virtually implementable social choice functions by using the linking mechanism proposed by M. O. Jackson and H. F. Sonnenschein [Econometrica 75, No. 1, 241–257 (2007; Zbl 1201.91036)] that restricts the message spaces. The principal does not require any incentive wage schemes and can therefore avoid any information rent and welfare loss. We show the resemblance between the functioning of this message space restriction and that of incentive wage schemes. We also extend the results of the single-agent model to the multi-agent model.

91B14 Social choice
91B40 Labor market, contracts (MSC2010)
91B44 Economics of information
Full Text: DOI
[1] Aoyagi, M., Correlated types and Bayesian incentive compatible mechanisms with budget balance, J. econ. theory, 79, 142-151, (1999) · Zbl 0911.90011
[2] Armstrong, M., Price discrimination by a many-product firm, Rev. econ. stud., 66, 151-168, (1999) · Zbl 0947.91052
[3] Bernheim, D.; Whinston, M., Multimarket contact and collusive behavior, RAND J. econ., 21, 1-25, (1990)
[4] Casella, A., Storable votes, Games econ. behav., 51, 391-419, (2005) · Zbl 1099.91038
[5] Casella, A.; Gelman, A.; Palfrey, T., An experimental study of storable votes, Games econ. behav., 57, 123-154, (2006) · Zbl 1151.91413
[6] Chung, K.S., A note on Matsushima’s regularity condition, J. econ. theory, 87, 429-433, (1999) · Zbl 1073.91554
[7] Crèmer, J.; McLean, R., Optimal selling strategies under uncertainty for a discriminating monopolist when demands are interdependent, Econometrica, 53, 345-361, (1985) · Zbl 0567.90011
[8] Crèmer, J.; McLean, R., Full extraction of the surplus in Bayesian and dominant strategy auctions, Econometrica, 56, 1247-1257, (1988) · Zbl 0661.90104
[9] D’Aspremont, C.; Gérard-Varet, L.A., Incentives and incomplete information, J. public econ., 11, 25-45, (1979)
[10] Eliaz, K.; Ray, D.; Razin, R., Group decision-making in the shadow of disagreement, J. econ. theory, 132, 236-273, (2007) · Zbl 1142.91397
[11] D. Engelmann, V. Grimm, Mechanisms for efficient voting with private information about preferences, Discussion Paper No. 03/2008, IWQW, 2008.
[12] Fan, K., On systems of linear inequalities, (), 99-156 · Zbl 0072.37602
[13] H. Fang, P. Norman, An efficient rationale for bundling of public goods, Cowles Foundation Discussion Paper No. 1441, 2003.
[14] H. Fang, P. Norman, Overcoming participation constraints, Cowles Foundation Discussion Paper No. 1511R, 2006.
[15] Fehr, E.; Falk, A., Psychological foundations of incentives, Europ. econ. rev., 46, 687-724, (2002)
[16] E. Fehr, S. Gächter, Do incentive contracts undermine voluntary cooperation?, Zurich IEER Working Paper No. 34, University of Zurich, 2002.
[17] Fehr, E.; Gächter, S.; Kirschsteiger, G., Reciprocity as a contract enforcement device—experimental evidence, Econometrica, 65, 833-860, (1997) · Zbl 0891.90039
[18] Fudenberg, D.; Tirole, J., Game theory, (1991), MIT Press Cambridge · Zbl 1339.91001
[19] Johnson, S.; Pratt, J.; Zeckhauser, R., Efficiency despite mutually payoff-relevant private information: the finite case, Econometrica, 58, 873-900, (1990) · Zbl 0729.90030
[20] Jackson, M.O.; Sonnenschein, H.F., Overcoming incentive constraints by linking decisions, Econometrica, 75, 241-258, (2007) · Zbl 1201.91036
[21] Matsushima, H., Incentive compatible mechanisms with full transferability, J. econ. theory, 54, 198-203, (1990) · Zbl 0742.90007
[22] Matsushima, H., Multimarket contact, imperfect monitoring, and implicit collusion, J. econ. theory, 98, 158-178, (2001) · Zbl 1016.91041
[23] Matsushima, H., Mechanism design with side payments: individual rationality and iterative dominance, J. econ. theory, 113, 1-30, (2007) · Zbl 1280.91086
[24] Myerson, R.B., Incentive compatibility and the bargaining problem, Econometrica, 47, 61-73, (1979) · Zbl 0399.90008
[25] Topkis, D., Supermodularity and complementarity, (1998), Princeton University Press Princeton
This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. It attempts to reflect the references listed in the original paper as accurately as possible without claiming the completeness or perfect precision of the matching.