How delegation improves commitment

Perino, Grischa (2010) How delegation improves commitment. Economics Letters, 106 (2). pp. 137-139.

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McCallum (1995, American Economic Review Papers and Proceedings 85 (2), 207-211) conjectures that delegation merely relocates the commitment problem but does not solve it. This holds if optimal ex-ante policies do not change if additional information becomes available. However, with a flexibility-credibility trade-off delegation improves credibility.

Item Type: Article
Faculty \ School: Faculty of Social Sciences > School of Economics
Depositing User: Julia Sheldrake
Date Deposited: 11 Jan 2011 16:40
Last Modified: 22 Dec 2022 15:31
DOI: 10.1016/j.econlet.2009.11.005

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