Supplementary Appendix to 'A Delegation-Based Theory of Expertise'

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2015-09-17

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Abstract

This supplement provides welfare results not contained in the main text and a proof of Lemma A.1. For small bonuses, a mixed equilibrium exists if and only if a downward equilibrium exists; if so, it is unique. For large bonuses, we find a unique candidate for mixed equilibrium and show that mixed and upward equilibria cannot co-exist. Also, we give an example for equal biases, where this candidate is indeed a mixed equilibrium. However, when biases are different enough and the bonus is high, a mixed equilibrium does not exist. Though a general analytical comparison is infeasible, we show that mixed equilibria are inferior to upward equilibrium or simple delegation in various special cases.

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Scholars@Duke

Ambrus

Attila Ambrus

Professor of Economics

Professor Ambrus’ research focuses on a broad range of subjects including game theory, experimental economics, microeconomic theory, industrial organization, political economics, development economics and economic history. He has received various grants from the National Science Foundation. His most recent work has been published in the American Economic Review, the Quarterly Journal of Economics, Econometrica, and Theoretical Economics.


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