Micro Seminars EUR

Speaker(s)
Ettore Damiano (University of Toronto, Canada)
Date
Friday, December 5, 2014
Location
Rotterdam

We consider a committee problem in which efficient information aggregation is hindered by differences in preferences. Sufficiently large delays could foster information aggregation but would require commitment. In a dynamic delay mechanism with limited commitment, successive rounds of decision-making are punctuated by delays that are uniformly bounded from above. Any optimal sequence of delays is finite, inducing in equilibrium both a “deadline play”, in which a period of no activity before the deadline is followed by full concession at the end to reach the efficient decision, and “stop- and-start” in the beginning, in which the maximum concession feasible alternates with no concession. Stop-and-start results from simultaneously maximizing both the “static” incentives for truth-telling – by maximizing the immediate delay penalty – and the “dynamic” incentives – by minimizing continuation payoffs. (Joint work with Wing Suen and Li, Hao.)