A partially informed expert, A, strategically transmits information to a principal, P. The residual uncertainty faced by the expert effectively causes the bias between P and A to be random, with two consequences. First, by misreporting A is likely to induce a decision choice by P, after the...

This note shows that the most informative equilibrium in the Crawford and Sobel (1982) game of strategic information transmission is almost fully revealing as the two players' preferences get closer to each other. It thus strengthens the original observation that the quality of information does...

In a two-task team project with observable task outcomes, optimal incentives prioritize tasks differently depending on task externalities. When the tasks are independent, Principal follows a decreasing order by placing more essential task first. A task is more essential if its failure...

In a two-period continuous effort investment game as in Mohnen, et al. (2008), we demonstrate that peer transparency can be strictly harmful. This contrasts with Mohnen et al.'s result that transparency, through the observability of interim efforts, induces more effort and is thus beneficial if...

A phantom bidding model is analyzed for a sale auction. The following questions are addressed: the effects of phantom bidding on overall social welfare and buyers' profits. It is shown that social welfare may increase or decrease as the auctioneer switches from the fixed reserve price policy to...

We consider a multi-stage game of fund-raising to study the announcement strategy of a fund-raiser, who is privately informed about the number of potential contributors, with the objective of collecting maximal contributions for a public project. We show that whether the public project is convex...

We study and compare law enforcement costs under two alternative burden of proof rules with the objective of reducing crime to a target level. We show that presuming innocence rather than guilt has a cost advantage, mainly due to lower costs of preventing collusion between law enforcers and...