Limit theorems for recursive delegation equilibria

Date

2022-12

Editor(s)

Advisor

Supervisor

Co-Advisor

Co-Supervisor

Instructor

BUIR Usage Stats
2
views
42
downloads

Citation Stats

Series

Abstract

Delegation games are studied in the context of a symmetric linear Cournotic duopoly where redelegation is permissible. In the absence of extraneous delegation costs, the following results are demonstrated: (1)Each principal has an incentive to redelegate, increasing the length of his delegation chain.(2)As the length of the delegation chain grows beyond bound, (i)total output at the (Cournot) equilibrium on the industry floor converges in monotonically increasing fashion to the socially efficient one, and(ii)the maximand delegated by each primal delegator converges in monotonically decreasing fashion to the (true) profit function. As a consequence it is suggested that in a linear duopoly context socially efficient and truthful outcomes can be arbitrarily closely approximated by the use of Pretend-but-Perform Mechanisms of order sufficiently large. © 2022, The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature.

Source Title

Review of Economic Design

Publisher

Springer

Course

Other identifiers

Book Title

Keywords

Degree Discipline

Degree Level

Degree Name

Citation

Published Version (Please cite this version)

Language

English