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The Implementation Duality

By Georg N\uf6ldeke and Larry Samuelson

Abstract

We use the theory of abstract convexity to study adverse-selection principal-agent problems and two-sided matching problems, departing from much of the literature by not requiring quasilinear utility. We formulate and characterize a basic underlying implementation duality. We show how this duality can be used to obtain a sharpening of the taxation principle, to obtain a general existence result for solutions to the principal-agent problem, to show that (just as in the quasilinear case) all increasing decision functions are implementable under a single crossing condition, and to obtain an existence result for stable outcomes featuring positive assortative matching in a matching model

Topics: C62, C78, D82, D86, ddc:330, Implementation, Duality, Galois Connection, Imperfectly Transferable Utility, Principal-Agent Model, Two-Sided Matching
Publisher: Basel: University of Basel, Center of Business and Economics (WWZ)
Year: 2015
OAI identifier: oai:econstor.eu:10419/123469
Provided by: EconStor

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