Document Type
Article
Publication Date
2-2026
Abstract
We study incentive design when multiple principals simultaneously design mechanisms for their respective teams in environments with strategic spillovers. In this environment, each principal’s set of incentive-compatible mechanisms—those that satisfy their own agents’ incentive compatibility constraints— depends on the mechanisms offered by the other teams. Following a classic example by Myerson (1982), such games may lack equilibrium due to discontinuities in the correspondence of incentive-compatible mechanisms. We establish general conditions for equilibrium existence by introducing a novel approach that involves tracking both the outcome distributions along the truthful-obedient path and the sets of outcome distributions achievable through unilateral deviations, thereby providing a foundation for analyzing a wide range of multi-principal mechanism design with team production and agency problems.
Recommended Citation
Roberson, B. (2026). Existence of equilibrium mechanisms in generalized principal-agent problems with interacting teams. ESI Working Paper 26-02. https://digitalcommons.chapman.edu/esi_working_papers/433/
Comments
ESI Working Paper 26-02