Optimal Duplication of Effort in Advocacy Systems

Giuliana Palumbo ()

No 502, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: The paper focuses on the creation of information for decision-making when agents' effort is non observable and rewards are indirect, that is, only based on the final decision. Following Dewatripont and Tirole (1999), the paper shows that the creation of advocates of special interests, as opposed to non-partisans, generates an efficient mechanism of mutual monitoring that reduces the scope for manipulation. Such monitoring is preferable over imposing penalties for detected manipulation; it is also preferable to creating an agency that monitors the non partisan agent. Applications to transfer price policies and comparative judicial systems are considered.

Keywords: advocacy; information creation; manipulation; monitoring (search for similar items in EconPapers)
JEL-codes: D23 D74 (search for similar items in EconPapers)
Date: 2004-06
New Economics Papers: this item is included in nep-mic
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Related works:
Journal Article: Optimal duplication of effort in advocacy systems (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:wptemi:td_502_04

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