Mixed strategies in combinatorial agency

  • Authors:
  • Moshe Babaioff;Michal Feldman;Noam Nisan

  • Affiliations:
  • UC Berkeley School of Information;School of Computer Science, Hebrew University of Jerusalem;School of Computer Science, Hebrew University of Jerusalem

  • Venue:
  • WINE'06 Proceedings of the Second international conference on Internet and Network Economics
  • Year:
  • 2006

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Abstract

We study a setting where a principal needs to motivate a team of agents whose combination of hidden efforts stochastically determines an outcome. In a companion paper we devise and study a basic “combinatorial agency” model for this setting, where the principal is restricted to inducing a pure Nash equilibrium. Here, we show that the principal may possibly gain from inducing a mixed equilibrium, but this gain can be bounded for various families of technologies (in particular if a technology has symmetric combinatorial structure). In addition, we present a sufficient condition under which mixed strategies yield no gain to the principal.