Money burning in the theory of delegation

被引：7
|
作者：
Amador, Manuel [1 ]
Bagwell, Kyle [2 ]
机构：
[1] Univ Minnesota, Fed Reserve Bank Minneapolis, Minneapolis, MN 55455 USA
[2] Stanford Univ, Stanford, CA 94305 USA
来源：
GAMES AND ECONOMIC BEHAVIOR | 2020年 / 121卷
基金：
美国国家科学基金会;
关键词：
Optimal delegation; Money burning; MECHANISM DESIGN; SETTINGS;
D O I：
10.1016/j.geb.2020.02.010
中图分类号：
F [经济];
学科分类号：
02 ;
摘要：
This paper uses a Lagrangian approach to provide sufficient conditions under which money burning expenditures are used in an optimal delegation contract. For comparison, we also establish simple sufficient conditions for the optimality of a cap allocation under a restricted set of preferences for a benchmark setting in which money burning is not allowed. We also apply our findings to a model of cooperation and to a model with quadratic preferences and families of distribution functions. In addition, we provide several comparative statics results. (C) 2020 Elsevier Inc. All rights reserved.
引用
收藏
页码：382 / 412
页数：31
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