Multicontracting: Coordination and Revenue Extraction in Games
Played Through Agents
Thomas Weber
Department of Management Science and Engineering
Stanford University
Wednesday, May 30, 2007
4:30 - 5:30 PM
Terman Engineering Center, Room 453
Abstract:
We consider a general multi-principal multi-agent contracting game in
a complete-information setting and determine coordinating equilibrium
transfer schedules. The resulting contracts manage to align incentives
for decentralized decision-making and achieve first-best outcomes. We
allow for multidimensional actions and arbitrary payoff externalities
between all players. The only assumptions needed are that all payoff
functions are continuous on compact action sets, in a general sense
that accommodates discrete action sets. We also examine how principals
can extract maximum surplus from their agents, and propose several
bargaining solutions to deal with the equilibrium multiplicity
problem. Our approach may be related to recent advances in algorithms
for efficient resource allocation in networks. It also relates to the
literature on menu auctions and lobbying.
Joint work with Bruno Strulovici and Hongxia Xiong.
Bio:
Bio TBA
Operations Research Colloquia: http://or.stanford.edu/oras_seminars.html