Essays in microeconomics

Abstract

This dissertation consists of three self-contained essays in microeconomics. The first chapter studies a principal-agent model where a biased agent can costly collect information useful for the principal. I study what is the optimal contract the principal should commit to, when she cannot do contingent transfers to the agent. When the agent's value of information is higher than its cost, the optimal mechanism is a threshold delegation rule. The principal allows the agent to choose among all the available actions up to some threshold. This threshold is increasing in the parameter measuring the cost of information. Otherwise, the principal will commit to extreme biased behavior to induce information acquisition. The utility of the principal is non-monotonic in the cost of information. While inducing information acquisition becomes more difficult with higher cost, certain deviations in the acquisition stage become more expensive and thus less profitable for the agent. The second chapter is coauthored with Julie Pinole. Knowing that Individuals interact with their peers, we study how a social planner can intervene, changing these interactions, in order to achieve a particular objective. When the objective is welfare maximization, we describe the interventions for games of strategic complements and strategic substitutes. We show that, for strategic complements, the planner uses resources to target central players; while she divides individuals into separated communities in the case of strategic substitutes. We study which connections she targets in order to achieve these goals. The third chapter is coauthored with Julie Pinole and analyzes a model of contagion on social network. We ask how a social planner should intervene to prevent contagion. We characterize the optimal intervention and the cost associated. We discuss the intuition behind the choice of the planner and we provide comparative static on the cost of intervention for different type of network.