We investigate optimal rationing of resources and organizational slack when a principal procures from an agent with private information about fixed and variable costs. We study the problem in a two-period setting with persistent types and investigate how the optimal rationing and slack depend on...

We investigate optimal rationing of resources and organizational slack when a principal procures from an agent with private information about fixed and variable costs. We study the problem in a two‐period setting with persistent types and investigate how the optimal rationing and slack depend...