Motivation and information design

Amir Habibi

Journal of Economic Behavior & Organization, 2020, vol. 169, issue C, 1-18

Abstract: I model a benevolent planner who motivates a time-inconsistent agent by only committing to provide feedback. The optimal feedback mechanism always takes the simple form of recommending an action. I also provide conditions for when the optimal feedback mechanism takes the simple form of a cutoff. I show that providing incentives through feedback always makes the time-inconsistent agent unambiguously better off, a property that does not necessarily hold when monetary instruments are used.

Keywords: Information design; Moral hazard; Time-inconsistency (search for similar items in EconPapers)
JEL-codes: D86 D90 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:169:y:2020:i:c:p:1-18

DOI: 10.1016/j.jebo.2019.10.015

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