The Allocation of Future Business: Dynamic Relational Contracts with Multiple Agents

• 成果类型: Article
• 署名作者: Andrews, Isaiah; Barron, Daniel
• 署名单位: Massachusetts Institute of Technology (MIT); Northwestern University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20131082
• 发表日期: 2016
• 页码: 2742-2759
• 关键词: implicit contracts; repeated games; american

摘要

We consider how a firm dynamically allocates business among several suppliers to motivate them in a relational contract. The firm chooses one supplier who exerts private effort. Output is non-contractible, and each supplier observes only his own relationship with the principal. In this setting, allocation decisions constrain the transfers that can be promised to suppliers in equilibrium. Consequently, optimal allocation decisions condition on payoff-irrelevant past performance to make strong incentives credible. We construct a dynamic allocation rule that attains first-best whenever any allocation rule does. This allocation rule performs strictly better than any rule that depends only on payoff-relevant information.