Related papers: Contract Design Beyond Hidden-Actions
The increasing deployment of AI is shaping the future landscape of the internet, which is set to become an integrated ecosystem of AI agents. Orchestrating the interaction among AI agents necessitates decentralized, self-sustaining…
Many real-life contractual relations differ completely from the clean, static model at the heart of principal-agent theory. Typically, they involve repeated strategic interactions of the principal and agent, taking place under uncertainty…
Incentives are more likely to elicit desired outcomes when they are designed based on accurate models of agents' strategic behavior. A growing literature, however, suggests that people do not quite behave like standard economic agents in a…
We study optimal contract design for large populations of heterogeneous agents whose actions generate network spillovers represented by an interaction function. In a linear-quadratic framework, we solve the finite-agent problem and its…
While the success of large language models (LLMs) increases demand for machine-generated text, current pay-per-token pricing schemes create a misalignment of incentives known in economics as moral hazard: Text-generating agents have strong…
This paper studies a dynamic screening model in which a principal hires an agent with limited liability. The agent's private cost of working is an i.i.d. draw from a continuous distribution. His working status is publicly observable. The…
Limited memory of decision-makers is often neglected in economic models, although it is reasonable to assume that it significantly influences the models' outcomes. The hidden-action model introduced by Holmstr\"om also includes this…
Recent technology advances have enabled firms to flexibly process and analyze sophisticated employee performance data at a reduced and yet significant cost. We develop a theory of optimal incentive contracting where the monitoring…
We initiate the study of computing (near-)optimal contracts in succinctly representable principal-agent settings. Here optimality means maximizing the principal's expected payoff over all incentive-compatible contracts---known in economics…
We analyze a model of selling a single object to a principal-agent pair who want to acquire the object for a firm. The principal and the agent have different assessments of the object's value to the firm. The agent is budget-constrained…
We study a principal-agent problem with adverse selection, where the principal does not know the agent's true cost but must design a contract to optimize a specific criterion. Unlike standard screening frameworks that allow for…
We consider a principal who wishes to screen an agent with \emph{discrete} types by offering a menu of \emph{discrete} quantities and \emph{discrete} transfers. We assume that the principal's valuation is discrete strictly concave and use a…
We investigate the problem of a principal looking to contract an expert to provide a probability forecast for a categorical event. We assume all experts have a common public prior on the event's probability, but can form more accurate…
In practice, incentive providers (i.e., principals) often cannot observe the reward realizations of incentivized agents, which is in contrast to many principal-agent models that have been previously studied. This information asymmetry…
We study a multi-agent contract design problem with moral hazard. In our model, each agent exerts costly effort towards an individual task at which it may either succeed or fail, and the principal, who wishes to encourage effort, has an…
In this paper, we initiate the computational problem of jointly designing information and contracts. We consider three possible classes of contracts with decreasing flexibility and increasing simplicity: ambiguous contracts, menus of…
We investigate the mechanism design problem faced by a principal who hires \emph{multiple} agents to gather and report costly information. Then, the principal exploits the information to make an informed decision. We model this problem as a…
In this paper, we consider a problem of contract theory in which several Principals hire a common Agent and we study the model in the continuous time setting. We show that optimal contracts should satisfy some equilibrium conditions and we…
We consider the design of experiments to evaluate treatments that are administered by self-interested agents, each seeking to achieve the highest evaluation and win the experiment. For example, in an advertising experiment, a company wishes…
We study a variant of the principal-agent problem in which the principal does not directly observe the agent's effort outcome; rather, she gets a signal about the agent's action according to a variable information structure designed by a…