Menu Auctions and Influence Games with Private Information

David Martimort and Lars Stole

MPRA Paper from University Library of Munich, Germany

Abstract: We study games in which multiple principals influence the choice of a privately-informed agent by offering action-contingent payments. We characterize the equilibrium allocation set as the maximizers of an endogenous aggregate virtual-surplus program. The aggregate maximand for every equilibrium includes an information-rent margin which captures the confluence of the principals’ rent-extraction motives. We illustrate the economic implications of this novel margin in two applications: a public goods game in which players incentivize a common public good supplier, and a lobbying game between conflicting interest groups who offer contributions to influence a common political decision-maker.

Keywords: Menu auctions; influence games; common agency; screening contracts; public goods games; lobbying games (search for similar items in EconPapers)
JEL-codes: D82 (search for similar items in EconPapers)
Date: 2015-02-23
New Economics Papers: this item is included in nep-cdm, nep-cta, nep-gth, nep-hpe, nep-mfd and nep-mic
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:62388

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