Harnessing Information in Incentive Design
Fuente:
arXiv
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| Autores principales: | , , |
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| Formato: | Preprint |
| Publicado: |
2025
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| _version_ | 1866909766820823040 |
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| author | Velicheti, Raj Kiriti Bose, Subhonmesh Başar, Tamer |
| author_facet | Velicheti, Raj Kiriti Bose, Subhonmesh Başar, Tamer |
| contents | Incentive design deals with interaction between a principal and an agent where the former can shape the latter's utility through a policy commitment. It is well known that the principal faces an information rent when dealing with an agent that has informational advantage. In this work, we embark on a systematic study of the effect of information asymmetry in incentive design games. Specifically, we first demonstrate that it is in principal's interest to decrease this information asymmetry. To mitigate this uncertainty, we let the principal gather information either by letting the agent shape her belief (aka Information Design), or by paying to acquire it. Providing solutions to all these cases we show that while introduction of uncertainty increases the principal's cost, letting the agent shape its belief can be advantageous. We study information asymmetry and information acquisition in both matrix games and quadratic Gaussian game setups. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2509_02493 |
| institution | arXiv |
| publishDate | 2025 |
| record_format | arxiv |
| spellingShingle | Harnessing Information in Incentive Design Velicheti, Raj Kiriti Bose, Subhonmesh Başar, Tamer Computer Science and Game Theory Multiagent Systems Systems and Control Optimization and Control Incentive design deals with interaction between a principal and an agent where the former can shape the latter's utility through a policy commitment. It is well known that the principal faces an information rent when dealing with an agent that has informational advantage. In this work, we embark on a systematic study of the effect of information asymmetry in incentive design games. Specifically, we first demonstrate that it is in principal's interest to decrease this information asymmetry. To mitigate this uncertainty, we let the principal gather information either by letting the agent shape her belief (aka Information Design), or by paying to acquire it. Providing solutions to all these cases we show that while introduction of uncertainty increases the principal's cost, letting the agent shape its belief can be advantageous. We study information asymmetry and information acquisition in both matrix games and quadratic Gaussian game setups. |
| title | Harnessing Information in Incentive Design |
| topic | Computer Science and Game Theory Multiagent Systems Systems and Control Optimization and Control |
| url | https://arxiv.org/abs/2509.02493 |