Deterministic versus stochastic mechanisms in principal-agent models

• 成果类型: Article
• 署名作者: Strausz, R
• 署名单位: Free University of Berlin
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2004.11.008
• 发表日期: 2006
• 页码: 306-314
• 关键词: principal-agent theory; mechanism design; deterministic mechanisms; randomization; Bunching

摘要

This paper shows that, contrary to what is generally believed, decreasing concavity of the agent's utility function with respect to the screening variable is not sufficient to ensure that stochastic mechanisms are suboptimal. The paper demonstrates, however, that they are suboptimal whenever the optimal deterministic mechanism exhibits no bunching. This is the case for most applications of the theory and therefore validates the literature's usual focus on deterministic mechanisms. (c) 2005 Elsevier Inc. All rights reserved.