Pure strategy and no-externalities with multiple agents : a comment

2011

We consider multiple-principal multiple-agent games of incomplete information. In this context, we identify a class of direct and incentive compatible mechanisms: each principal privately recommends to each agent to reveal her private information to the other principals, and each agent behaves truthfully. We show that there is a rationale in restricting attention to this class of mechanisms: if all principals

2007

In multiple-principal multiple-agent models of moral hazard, we provide sufficient conditions for the outcomes of pure-strategy equilibria in direct mechanisms to be preserved when principals can offer indirect communication schemes. The conditions include strong robustness in the direct mechanism game, as developed in the literature on competing mechanisms by Peters and , and a no-correlation property we define. We provide a rationale for restricting attention to take-it or leave-it offers, as is typically done in applications. We show via examples that it is necessary to allow direct mechanisms to be stochastic and to include private recommendations from principals to agents to preserve the corresponding equilibrium outcomes, and that the no-correlation condition is tight.

SSRN Electronic Journal, 2000

We consider multiple-principal multiple-agent games of incomplete information in which each agent can at most participate with one principal. In such contexts, we show that the restriction to direct truthful mechanisms involves a loss of generality, even if one only focuses on pure strategy equilibria. However, the traditional Revelation Principle retains its power in games with a single agent.

2014

It is argued that the revelation principle in multi-principal multi-agent games cannot be generalized. In other words, one cannot restrict attention to incentive compatible mechanisms, even if the concept of information is enlarged.

Journal of Mathematical Economics, 2013

We consider multiple-principal multiple-agent games of incomplete information. We identify a class of two-way communication mechanisms which mirror those considered in the single principal analysis of . In such mechanisms, every agent truthfully reveals her type to all principals, and obeys the private recommendations she receives from each of them. We show that there is a rationale in restricting attention to this class of mechanisms: if principals use these mechanisms, there is no unilateral incentive to deviate towards more sophisticated ones. We develop three examples to analyze possible extensions and limits of our approach. The first two examples show that the restriction to direct and incentive compatible mechanisms is not sufficient to provide a complete characterization of all pure strategy equilibria. The third one shows that private recommendations play a fundamental role in competing mechanism games, suggesting that one cannot safely restrict to one-sided communication mechanisms.

Econometrica, 2002

In the context of common agency adverse-selection games we illustrate that the revelation principle cannot be applied to study equilibria of the multi-principal games. We then demonstrate that an extension of the taxation principle -what we term the "delegation principle" -can be used to characterize the set of all common agency equilibria.

2006

In multiple principal, multiple agent models of moral hazard, we provide conditions under which the outcomes of equilibria in direct mechanisms are preserved when principals can offer indirect communication schemes. We discuss the role of random allocations and recommendations and relate the result to the existing literature.