Optimally Biased Expertise

Research output: Working paper › Preprint › Research

Standard

Optimally Biased Expertise. / Ilinov, Pavel; Senkov, Maxim; Matveenko, Andrei; Starkov, Egor.

2209.13689. ed. arXiv.org, 2022.

Research output: Working paper › Preprint › Research

Harvard

Ilinov, P, Senkov, M, Matveenko, A & Starkov, E 2022 'Optimally Biased Expertise' 2209.13689 edn, arXiv.org. https://doi.org/10.48550/arXiv.2209.13689

APA

Ilinov, P., Senkov, M., Matveenko, A., & Starkov, E. (2022). Optimally Biased Expertise. (2209.13689 ed.) arXiv.org. https://doi.org/10.48550/arXiv.2209.13689

Vancouver

Ilinov P, Senkov M, Matveenko A, Starkov E. Optimally Biased Expertise. 2209.13689 ed. arXiv.org. 2022 Sep 27. https://doi.org/10.48550/arXiv.2209.13689

Author

Ilinov, Pavel ; Senkov, Maxim ; Matveenko, Andrei ; Starkov, Egor. / Optimally Biased Expertise. 2209.13689. ed. arXiv.org, 2022.

Bibtex

@techreport{519908cb08f741c48cb86b126fd12cf5,
title = "Optimally Biased Expertise",
abstract = "This paper shows that the principal can strictly benefit from delegating a decision to an agent whose opinion differs from that of the principal. We consider a {"}delegated expertise{"} problem, in which the agent has an advantage in information acquisition relative to the principal, as opposed to having preexisting private information. When the principal is ex ante predisposed towards some action, it is optimal for her to hire an agent who is predisposed towards the same action, but to a smaller extent, since such an agent would acquire more information, which outweighs the bias stemming from misalignment. We show that belief misalignment between an agent and a principal is a viable instrument in delegation, performing on par with contracting and communication in a class of problems.",
author = "Pavel Ilinov and Maxim Senkov and Andrei Matveenko and Egor Starkov",
year = "2022",
month = sep,
day = "27",
doi = "10.48550/arXiv.2209.13689",
language = "English",
volume = "econ.TH",
publisher = "arXiv.org",
edition = "2209.13689",
type = "WorkingPaper",
institution = "arXiv.org",

}

RIS

TY - UNPB

T1 - Optimally Biased Expertise

AU - Ilinov, Pavel

AU - Senkov, Maxim

AU - Matveenko, Andrei

AU - Starkov, Egor

PY - 2022/9/27

Y1 - 2022/9/27

N2 - This paper shows that the principal can strictly benefit from delegating a decision to an agent whose opinion differs from that of the principal. We consider a "delegated expertise" problem, in which the agent has an advantage in information acquisition relative to the principal, as opposed to having preexisting private information. When the principal is ex ante predisposed towards some action, it is optimal for her to hire an agent who is predisposed towards the same action, but to a smaller extent, since such an agent would acquire more information, which outweighs the bias stemming from misalignment. We show that belief misalignment between an agent and a principal is a viable instrument in delegation, performing on par with contracting and communication in a class of problems.

AB - This paper shows that the principal can strictly benefit from delegating a decision to an agent whose opinion differs from that of the principal. We consider a "delegated expertise" problem, in which the agent has an advantage in information acquisition relative to the principal, as opposed to having preexisting private information. When the principal is ex ante predisposed towards some action, it is optimal for her to hire an agent who is predisposed towards the same action, but to a smaller extent, since such an agent would acquire more information, which outweighs the bias stemming from misalignment. We show that belief misalignment between an agent and a principal is a viable instrument in delegation, performing on par with contracting and communication in a class of problems.

U2 - 10.48550/arXiv.2209.13689

DO - 10.48550/arXiv.2209.13689

M3 - Preprint

VL - econ.TH

BT - Optimally Biased Expertise

PB - arXiv.org

ER -

ID: 333395422