Related papers: Contract Design Beyond Hidden-Actions
We examine the trade-off between the provision of incentives to exert costly effort (ex-ante moral hazard) and the incentives needed to prevent the agent from manipulating the profit observed by the principal (ex-post moral hazard).…
A principal must decide between two options. Which one she prefers depends on the private information of two agents. One agent always prefers the first option; the other always prefers the second. Transfers are infeasible. One application…
We study a screening problem in which an agent privately observes a set of feasible technologies and can strategically disclose only a subset to the principal. The principal then takes an action whose payoff consequences for both players…
In a framework close to the one developed by Holmstr\"om and Milgrom [44], we study the optimal contracting scheme between a Principal and several Agents. Each hired Agent is in charge of one project, and can make efforts towards managing…
We study a model of delegation in which a principal takes a multidimensional action and an agent has private information about a multidimensional state of the world. The principal can design any direct mechanism, including stochastic ones.…
We study how to optimally design selection mechanisms, accounting for agents' investment incentives. A principal wishes to allocate a resource of homogeneous quality to a heterogeneous population of agents. The principal commits to a…
We analyze a principal-agent procurement problem in which the principal (she) is unaware some of the marginal cost types of the agent (he). Communication arises naturally as some types of the agent may have an incentive to raise the…
We examine hypothesis testing within a principal-agent framework, where a strategic agent, holding private beliefs about the effectiveness of a product, submits data to a principal who decides on approval. The principal employs a hypothesis…
We consider a dynamic moral hazard problem between a principal and an agent, where the sole instrument the principal has to incentivize the agent is the disclosure of information. The principal aims at maximizing the (discounted) number of…
Ranking is fundamental to many areas, such as search engine optimization, human feedback for language models, as well as peer grading. Crowdsourcing, which is often used for these tasks, requires proper incentivization to ensure accurate…
I study whether and which expert incentives can be provided at what cost when the states of the world become non-contractible, but there is some noisy observation about the states that can be contracted upon. A principal hires an agent to…
In a decision-making scenario, a principal could use conditional predictions from an expert agent to inform their choice. However, this approach would introduce a fundamental conflict of interest. An agent optimizing for predictive accuracy…
A principal hires an agent to work on a long-term project that culminates in a breakthrough or a breakdown. At each time, the agent privately chooses to work or shirk. Working increases the arrival rate of breakthroughs and decreases the…
We consider moral hazard problems where a principal has access to rich monitoring data about an agent's action. Rather than focusing on optimal contracts (which are known to in general be complicated), we characterize the optimal rate at…
Decision-makers in high-stakes selection processes often face a fundamental choice: whether to make decisions themselves or to delegate authority to another entity whose incentives may only be partially aligned with their own. Such…
Can a principal still offer optimal dynamic contracts that are linear in end-of-period outcomes when the agent controls a process that exhibits memory? We provide a positive answer by considering a general Gaussian setting where the output…
The agency problem emerges in today's large scale machine learning tasks, where the learners are unable to direct content creation or enforce data collection. In this work, we propose a theoretical framework for aligning economic interests…
Consider a principal who wants to search through a space of stochastic solutions for one maximizing their utility. If the principal cannot conduct this search on their own, they may instead delegate this problem to an agent with distinct…
Environments with fixed adjustment costs such as transaction costs or \lq menu costs\rq$ $ are widespread within economic systems. The presence of fixed minimal adjustment costs produces adjustment stickiness so that agents must choose a…
We consider a continuous time Principal-Agent model on a finite time horizon, where we look for the existence of an optimal contract both parties agreed on. Contrary to the main stream, where the principal is modelled as risk-neutral, we…