Aligned Delegation

Alexander Frankel

American Economic Review, 2014, vol. 104, issue 1, 66-83

Abstract: A principal delegates multiple decisions to an agent, who has private information relevant to each decision. The principal is uncertain about the agent's preferences. I solve for max-min optimal mechanisms? those which maximize the principal's payoff against the worst case agent preference types. These mechanisms are characterized by a property I call "aligned delegation": all agent types play identically, as if they shared the principal's preferences. Max-min optimal mechanisms may take the simple forms of ranking mechanisms, budgets, or sequential quotas.

JEL-codes: D44 D83 J16 (search for similar items in EconPapers)
Date: 2014
Note: DOI: 10.1257/aer.104.1.66
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Citations: View citations in EconPapers (42)

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