Strategic Information Gathering Before a Contract is Offered

Jacques Crémer (), Fahad Khalil and Jean Rochet

Working Papers from Toulouse - GREMAQ

Abstract: We study how optimal contracts are modified when the agent has the possibility to acquire information before the contract is offered to him. We consider a situation in which this information is always available to the agent just before producing. Therefore, prior information acquisition is socially wasteful, and conducted only for the purpose of rent seeking. In this context, we show that the typical outcome is one in which the agent randomizes between acquiring information or not. Therefore, the principal cannot perfectly anticipate whether the agent is informed or not, and has to offer two different contracts. One is designed for uninformed agents, the other is designed for informed agents.

Keywords: REGULATION; INFORMATION (search for similar items in EconPapers)
JEL-codes: D82 L51 (search for similar items in EconPapers)
Pages: 37 pages
Date: 1996
References: Add references at CitEc
Citations: View citations in EconPapers (10)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Strategic Information Gathering before a Contract Is Offered (1998)
Working Paper: Strategic Information Gathering Before a Contract is Offered (1997)
Working Paper: Strategic Information Gathering Before a Contract is Offered (1997)
Working Paper: Strategic Information Gathering Before a Contract Is Offered (1996)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fth:gremaq:976.425

Access Statistics for this paper

More papers in Working Papers from Toulouse - GREMAQ GREMAQ, Universite de Toulouse I Place Anatole France 31042 - Toulouse CEDEX France.. Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Krichel ().