17.10. BGSE Micro Workshop: Vitali Gretschko
BGSE Micro Workshop with Vitali Gretschko (Mannheim University)
Event details | |
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What |
|
When |
Oct 17, 2018 from 12:00 to 13:00 |
Where | room 0.017 |
Contact Name | Stephan Lauermann |
Contact Email | [Email protection active, please enable JavaScript.] |
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Topic
CONTRACT DESIGN WITH LIMITED COMMITMENT
Abstract
We
consider the problem of a principal who wishes to contract with a
privately informed agent and is not able to commit to not renegotiating
any mechanism. That is, we allow the principal, after
observing the outcome of a mechanism to renegotiate the resulting
contract without cost by proposing a new mechanism any number of times.
We propose a solution concept similar to von Neumann-Morgenstern
stable sets and show that it provides an effective
and easy-to-use tool to analyze contracting problems with limited
commitment. We apply the solution concept to a setting with a continuous
type space, private values and non-linear contracts. We find that the
optimal contracts for the principal are pooling
and satisfy a “no-distortion-at-the-bottom” property.
filed under:
BGSE Workshop