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Information extraction and exclusivity

Authors: Alberto Bisin; Danilo Guaitoli;

Information extraction and exclusivity

Abstract

Much analysis has been recently devoted in the contract literature to economies in which each agent observes a signal about other agents' private information. This toghether with correlation among agents' outputs may be used to design information extraction mechanisms. In some cases it can be shown that the optimal contract implements full information extraction, and hence the incentive constrained optimum coincides with the Pareto optimum. We study the robustness of information extraction mechanism with respect to economies in which `exclusive' contracts cannot be implemented. By this we mean situations in which a `principal' or a financial intermediary cannot observe, monitor or contract upon all the contractual relationships an agent may enter with other intermediaries or agents. This is a very plausible situation if we think of informal or implicit contracts that are not in general publicly observable. In a previous paper (Bisin and Guaitoli 1998) we analyzed equilibria with moral hazard and financial intermediaries competing in a `non-exclusivity' environment, showing that equilibria are never second best efficient and very often fail to implement the optimal action. It is interesting to ask, therefore, whether information extraction in groups of agents may overcome the serious inefficiency generated by non-exclusivity.

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selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
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