On young Turks and yes men: optimal contracting for advice
Publication
, Journal Article
Häfner, S; Taylor, CR
Published in: RAND Journal of Economics
March 1, 2022
We study contracting for advice by an agent about how much a principal should invest in a project. Providing the agent with incentives to perform research endogenously generates incentives for her to misreport the results. For high-cost (low-cost) projects, she wishes to overstate (understate) the magnitude—though not the direction—of her research findings. For high-cost projects, the principal mitigates the concomitant agency rents by committing to ignore extreme (Young-Turk) recommendations, whereas for low-cost projects, he ignores mild (Yes-Man) ones. These results are shown to be robust to several natural extensions of the model.
Duke Scholars
Published In
RAND Journal of Economics
DOI
EISSN
1756-2171
ISSN
0741-6261
Publication Date
March 1, 2022
Volume
53
Issue
1
Start / End Page
63 / 94
Related Subject Headings
- Economics
- 3803 Economic theory
- 3802 Econometrics
- 3801 Applied economics
- 14 Economics
Citation
APA
Chicago
ICMJE
MLA
NLM
Häfner, S., & Taylor, C. R. (2022). On young Turks and yes men: optimal contracting for advice. RAND Journal of Economics, 53(1), 63–94. https://doi.org/10.1111/1756-2171.12400
Häfner, S., and C. R. Taylor. “On young Turks and yes men: optimal contracting for advice.” RAND Journal of Economics 53, no. 1 (March 1, 2022): 63–94. https://doi.org/10.1111/1756-2171.12400.
Häfner S, Taylor CR. On young Turks and yes men: optimal contracting for advice. RAND Journal of Economics. 2022 Mar 1;53(1):63–94.
Häfner, S., and C. R. Taylor. “On young Turks and yes men: optimal contracting for advice.” RAND Journal of Economics, vol. 53, no. 1, Mar. 2022, pp. 63–94. Scopus, doi:10.1111/1756-2171.12400.
Häfner S, Taylor CR. On young Turks and yes men: optimal contracting for advice. RAND Journal of Economics. 2022 Mar 1;53(1):63–94.
Published In
RAND Journal of Economics
DOI
EISSN
1756-2171
ISSN
0741-6261
Publication Date
March 1, 2022
Volume
53
Issue
1
Start / End Page
63 / 94
Related Subject Headings
- Economics
- 3803 Economic theory
- 3802 Econometrics
- 3801 Applied economics
- 14 Economics