AffiliationUniv Arizona, Eller Coll Management
MetadataShow full item record
PublisherAMER ECONOMIC ASSOC
CitationDeimen, Inga, and Dezső Szalay. 2019. "Delegated Expertise, Authority, and Communication." American Economic Review, 109 (4): 1349-74.
JournalAMERICAN ECONOMIC REVIEW
RightsCopyright © 2019 American Economic Association. All rights reserved.
Collection InformationThis item from the UA Faculty Publications collection is made available by the University of Arizona with support from the University of Arizona Libraries. If you have questions, please contact us at firstname.lastname@example.org.
AbstractA decision maker needs to reach a decision and relies on an expert to acquire information. Ideal actions of expert and decision maker are partially aligned and the expert chooses what to learn about each. The decision maker can either get advice from the expert or delegate decision making to him. Under delegation, the expert learns his privately optimal action and chooses it. Under communication, advice based on such information is discounted, resulting in losses from strategic communication. We characterize the communication problems that make the expert acquire information of equal use to expert and decision maker. In these problems, communication outperforms delegation. (JEL, D82, D83)
VersionFinal published version