The informativeness principle without the first-order approach

Chaigneau, Pierre, Edmans, Alex and Gottlieb, Daniel ORCID: 0000-0002-0555-6185 (2019) The informativeness principle without the first-order approach. Games and Economic Behavior, 113. 743 - 755. ISSN 0899-8256

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Abstract

Holmström (1979) provides a condition for a signal to have positive value assuming the validity of the first-order approach. This paper extends Holmström's analysis to settings where the first-order approach may not hold. We provide a new condition for a signal to have positive value that takes non-local incentive constraints into account and holds generically. Our condition is the weakest condition possible in the absence of restrictions on the utility function.

Item Type:	Article
Official URL:	https://www.journals.elsevier.com/games-and-econom...
Additional Information:	© 2019 Elsevier B.V.
Divisions:	Management
Subjects:	H Social Sciences > HB Economic Theory B Philosophy. Psychology. Religion > BC Logic
Date Deposited:	26 Oct 2019 11:48
Last Modified:	29 Nov 2024 18:45
URI:	http://eprints.lse.ac.uk/id/eprint/102226

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