Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/213845 
Year of Publication: 
2020
Series/Report no.: 
Discussion Paper No. 2020/3
Publisher: 
Freie Universität Berlin, School of Business & Economics, Berlin
Abstract: 
This paper studies how information control affects incentives for collusion and optimal organizational structures in principal-supervisor-agent relationships. I consider a model in which the principal designs the supervisor's signal on the productive agent's private information and the supervisor and agent may collude. I show that the principal optimally delegates the interaction with the agent to the supervisor if either the supervisor's budget is large or the value of production is small. The principal prefers direct communication with the supervisor and agent if the supervisor's budget is sufficiently small and the value of production is high.
Subjects: 
Collusion
Information design
Delegation
JEL: 
D73
D83
D86
H57
M55
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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