In our setting, the agent's bias can benefit the principal by creating a wedge between the ex ante favorite decisions of the principal and the agent. With this wedge, the principal can select a delegation set that punishes the agent if his experiment fails, at a lower cost to the principal.
Nov 20, 2023 · Abstract:A principal delegates decisions to a biased agent. Payoffs depend on a state that the principal cannot observe.
Under certain conditions on the cost of information acquisition, we show that the principal prefers delegating to an agent with a small bias than to an unbiased ...
Mar 12, 2024 · A principal delegates decisions to a biased agent. Payoffs depend on a state that the principal cannot observe. Initially, the agent does ...
Nov 20, 2023 · A principal delegates decisions to a biased agent. Payoffs depend on a state that the principal cannot observe. Initially, the agent does ...
Another finding shows that, although the biased type of expert only distorts information transmission, the existence of this type may actually increase the ...
Co-authors ; Benefiting from bias: Delegating to encourage information acquisition. I Ball, X Gao. Journal of Economic Theory 217, 105816, 2024. 12, 2024.
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Benefiting from Bias: Delegating to Encourage Information Acquisition with Xin Gao Journal of Economic Theory (2024). Content Filtering with Inattentive ...
In this paper, we analyze the optimal delegation policy in which the agent has different types of bias, and where he can acquire the information.
Missing: encourage | Show results with:encourage
Unlike in standard delegation models, the principal's payoff is maximized when the agent's bias is nonzero.