Contracts and Productive Information Gathering

The value of information for auctioneers

“…If marginal revenues are increasing, the optimal allocation a k is increasing in z k for all k. This allocation is then incentive-compatible for all information structures. 15 As is well-known (see for example Fudenberg and Tirole [22]), a sufficient condition is that the distribution G i satisfies the monotone hazard rate condition (which it does since G i (z i ) = z i ) and w i (G, z) is concave in z i . 16 But these sufficient conditions are overly restrictive, and therefore I follow Bulow and…”

“…In such an environment, the auctioneer prefers an asymmetric allocation of information. 18 Let the first environment E 1 be 15 In an optimal auction design problem with a fixed information structure, it is a standard assumption that marginal revenues are increasing (Myerson [33], Riley and Samuelson [35], Bulow and Roberts [12] and Bulow and Klemperer [10]). As Bulow and Klemperer [10] state, it is a regularity condition that is analogous to an assumption of a downward-sloping marginal revenue curve in monopoly theory.…”

“…3 A large body of literature considers the bidders' and not the auctioneer's preferences for information in contractual relationships. Crémer and Khalil [14], Lewis and Sappington [29], and Crémer, Khalil and Rochet [15,16] 4 all concentrate on information acquisition of the all-or-nothing variety. The agents have to decide either to become perfectly informed 1 See Myerson [33] and Crémer and McLean [17,18].…”

Biodiversity Conservation on Private Lands: Information Problems and Regulatory Choices

“…Not until recent years did economists start studying ability information asymmetry (Cremer et al 1992, 1998a, 1998b, Sobel 1993, Lewis and Sappington 1997. These studies, all starting with the assumption that there is only information acquisition cost (ability) difference between the regulator and agent, try to endogenize the information structure and evaluate the regulated agent s incentives to acquire information.…”

Auction design with endogenously correlated buyer types

“…There seems to be surprisingly little work in the mechanism design literature that considers optimal design with an ex ante action by the designer. Instead, most work focusses on optimal design with ex ante actions by agents, such as investments in their valuation or information acquisition (e.g., Rogerson, 1992, Cremer et al, 1998, Bergemann and Välimäki, 2002, to name only a few).…”