Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/93890
Authors: 
Kovác, Eugen
Krähmer, Daniel
Year of Publication: 
2013
Series/Report no.: 
SFB/TR 15 Discussion Paper 427
Abstract: 
The paper extends the optimal delegation framework pioneered by Holmström (1977, 1984) to a dynamic environment where, at the outset, the agent privately knows his ability to interpret decision relevant private information received later on. We show that any mechanism can be implemented by a sequential menu of delegation sets where the agent first picks a delegation set and then chooses an action within this set. For the uniform{quadratic case, we characterize when sequential delegation is strictly better than static delegation and derive the optimal delegation menu. We provide sufficient conditions so that our results extend beyond the uniform distribution.
Subjects: 
optimal delegation
sequential screening
dynamic mechanism design
non-transferable utility
JEL: 
D02
D20
D82
D86
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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