Artikel
Equilibrium contracts and boundedly rational expectations
We study a principal-agent framework in which the agent forms beliefs about the principal's project based on a misspecified subjective model. She fits this model to the objective probability distribution to predict output under alternative actions. Misspecifications in the subjective model may lead to biased beliefs. However, under mild restrictions, the agent has correct beliefs on the equilibrium path so that the optimal contract is nonexploitative. This allows for a behavioral version of the informativeness principle: The optimal contract conditions on an additional variable only if it is informative about the action according to the agent's subjective model. We further characterize when misspecifications affect the optimal contract. One implication of this characterization is that the scope for belief biases depends on the agent's job, for example, her position in the hierarchy.
- Sprache
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Englisch
- Erschienen in
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Journal: Theoretical Economics ; ISSN: 1555-7561 ; Volume: 17 ; Year: 2022 ; Issue: 1 ; Pages: 371-414 ; New Haven, CT: The Econometric Society
- Klassifikation
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Wirtschaft
Asymmetric and Private Information; Mechanism Design
Economics of Contract: Theory
- Thema
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Bayesian networks
principal-agent relationship
bounded rationality
- Ereignis
-
Geistige Schöpfung
- (wer)
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Schumacher, Heiner
Thysen, Heidi Christina
- Ereignis
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Veröffentlichung
- (wer)
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The Econometric Society
- (wo)
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New Haven, CT
- (wann)
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2022
- DOI
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doi:10.3982/TE4231
- Handle
- Letzte Aktualisierung
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10.03.2025, 11:42 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Artikel
Beteiligte
- Schumacher, Heiner
- Thysen, Heidi Christina
- The Econometric Society
Entstanden
- 2022
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