Related papers: Contract Design Under Approximate Best Responses
We study a two-period moral hazard problem; there are two agents, with action sets that are unknown to the principal. The principal contracts with each agent sequentially, and seeks to maximize the worst-case discounted sum of payoffs,…
We study a continuous time contracting model in which a principal hires a risk averse agent to manage a project over a finite horizon and provides sequential payments whose timing is endogenously determined. The resulting nonzero-sum…
Combinatorial contracts are emerging as a key paradigm in algorithmic contract design, paralleling the role of combinatorial auctions in algorithmic mechanism design. In this paper we study natural combinatorial contract settings involving…
We initiate the study of online contracts, which integrate the game-theoretic considerations of economic contract theory, with the algorithmic and informational challenges of online algorithm design. Our starting point is the classic online…
When machine learning is outsourced to a rational agent, conflicts of interest might arise and severely impact predictive performance. In this work, we propose a theoretical framework for incentive-aware delegation of machine learning…
We study a new class of contract design problems where a principal delegates the execution of multiple projects to a set of agents. The principal's expected reward from each project is a combinatorial function of the agents working on it.…
Economic theory distinguishes between principal-agent settings in which the agent has a private type and settings in which the agent takes a hidden action. Many practical problems, however, involve aspects of both. For example, brand X may…
Fraud can pose a challenge in many resource allocation domains, including social service delivery and credit provision. For example, agents may misreport private information in order to gain benefits or access to credit. To mitigate this, a…
We analyze conditional optimization problems arising in discrete time Principal-Agent problems of delegated portfolio optimization with linear contracts. Applying tools from Conditional Analysis we show that some results known in the…
What type of delegation contract should be offered when facing a risk of the magnitude of the pandemic we are currently experiencing and how does the likelihood of an exogenous early termination of the relationship modify the terms of a…
A contract is an economic tool used by a principal to incentivize one or more agents to exert effort on her behalf, by defining payments based on observable performance measures. A key challenge addressed by contracts -- known in economics…
In this paper we investigate a Principal-Agent problem with moral hazard under Knightian uncertainty. We extend the seminal framework of Holmstr\"om and Milgrom by combining a Stackelberg equilibrium with a worst-case approach. We…
We consider a principal-agent problem where the agent may privately choose to acquire relevant information prior to taking a hidden action. This model generalizes two special cases: a classic moral hazard setting, and a more recently…
This paper studies continuous-time optimal contracting in a hierarchy problem which generalises the model of Sung (2015). The hierarchy is modeled by a series of interlinked principal-agent problems, leading to a sequence of Stackelberg…
Fairness is desirable yet challenging to achieve within multi-agent systems, especially when agents differ in latent traits that affect their abilities. This hidden heterogeneity often leads to unequal distributions of wealth, even when…
This work studies the online contract design problem. The principal's goal is to learn the optimal contract that maximizes her utility through repeated interactions, without prior knowledge of the agent's type (i.e., the agent's cost and…
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…
Crowdsourcing markets have emerged as a popular platform for matching available workers with tasks to complete. The payment for a particular task is typically set by the task's requester, and may be adjusted based on the quality of the…
Firms have access to abundant data on market participants. They use these data to target contracts to agents with specific characteristics, and describe these contracts in opaque terms. In response to such practices, recent proposed…
In this paper we consider a principal agent problem where the agent is allowed to quit, by incurring a cost. When the current agent quits the job, the principal will hire a new one, possibly with a different type. We characterize the…