Seminar

Past

Credibility, Efficiency and the Structure of Authority

Sinem Hidir

  • Date9 November 2021
  • Time 11h00 - 12h30
  • Room Online

Abstract

In many economic settings it is optimal to endow individuals with high abilities, rather than those with low abilities, with decision-making power. Yet there is rich empirical evidence showing that many of those in charge of decisions are not necessarily the most talented. We offer a novel rationale for why choosing a decision maker with low ability might be welfare-optimal. In a setting with two-sided information acquisition where the players disagree only when uninformed, we show that a high-ability principal optimally delegates authority toa low-ability agent because the latter not only exerts higher effort than under centralized decision-making, but also follows the principal’s advice when uninformed himself. joint with Dimitri Migrow .

Related document(s)

Other seminars

To be announced

  • Seminar

  • Economic Theory Seminar

  • Date 8 December 2026

  • Place Auditorium 3 - JJ Laffont

  • Speaker or organiser Piotr Dworczak (Northwestern University)

Details

To be announced

  • Seminar

  • Economic Theory Seminar

  • Date 24 November 2026

  • Place Auditorium 5

  • Speaker or organiser Frank Yang (Stanford University)

Details

To be announced

  • Seminar

  • Economic Theory Seminar

  • Date 17 November 2026

  • Place Auditorium 5

  • Speaker or organiser Qianjun Lyu (University Carlos III of Madrid)

Details