Unidirectional incentive compatibility

• 成果类型: Article
• 署名作者: Kraehmer, Daniel; Strausz, Roland
• 署名单位: University of Bonn; Humboldt University of Berlin
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2025.106051
• 发表日期: 2025
• 关键词: Screening; Verifiability; Non-monotonicity; Failure of revenue equivalence; implementability; optimal contracting

摘要

We study unidirectional incentive compatibility which incentivizes truth-telling by an agent who can misrepresent private information in one direction only. In the canonical setting with quasi-linear preferences and continuous, one-dimensional private information, we show that unidirectional incentive compatibility imposes no restrictions on the allocation rule and revenue equivalence fails. Moreover, unidirectional incentive compatibility holds if and only if the change of the agent's information rent respects a lower bound based on the allocation rule's monotone envelope. With strong interdependent values or countervailing incentives, optimal screening contracts differ from optimal bidirectionally incentive compatible contracts, possibly displaying non-monotone allocations.