Balázs Szentes (LSE): Optimal Monitoring Design

A BME Matematikai Intézet (Összintézeti)
Matematikai Modellalkotás Szemináriuma

Kivonat:
This paper considers a Principal–Agent model with hidden action in which the Principal can monitor the Agent by acquiring independent signals conditional on effort at a constant marginal cost. The Principal aims to implement a target effort level at minimal cost. The main result of the paper is that the optimal information-acquisition strategy is a two-threshold policy and, consequently, the equilibrium contract specifies two possible wages for the Agent. This result provides a rationale for the frequently observed single-bonus wage contracts.

The talk is held in English!
Az előadás nyelve angol!