direct mechanisms, menus and latent contracts直接的机制,菜单和潜在的合同.pdfVIP

Modern Economy, 2010, 1, 51-58 doi:10.4236/me.2010.11005 Published Online May 2010 (http://www.SciRP.org/journal/me) Direct Mechanisms, Menus and Latent Contracts Gwenaël Piaser1,2 1 IPAG Business School, Paris, France 2Luxembourg School of Finance, Luxembourg, Luxembourg E-mail : gwenael.piaser@uni.lu Received February 17, 2010; revised March 20, 2010; accepted March 30, 2010 Abstract In common agency games, one cannot characterize all equilibria by considering only direct mechanisms. In an attempt to overcome this difficulty, Peters [1] and Martimort and Stole [2] identified a class of indirect mechanisms (namely, menus) which are able to characterize every equilibrium. Unfortunately, menus are difficult to handle, and several methodologies have been proposed in the literature. Here, it is shown that, even if authors consider menus rather than simpler mechanisms, many equilibria described in the literature could have been characterized by direct incentive compatible mechanisms. Use of more sophisticated me- chanisms was not necessary in these cases. Keywords: Common Agency, Revelation Principle, Delegation Principle, Direct Mechanisms, Menus, Latent Contracts 1. Introduction and Rochet [6], and states that there is no loss of general- ity in considering menus, or nonlinear prices. Peters [1] and Martimort and Stole [2] show that an equivalent of The restriction to direct incentive compatible mecha