The equilibrium of principal-agent between principal and experts in group decision making
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Abstract
There are two game relations in group-decision-making in which decision promoters and experts have inconsistent benefits, one is the relationship between promoters and experts, the other is static game of complete information relationship among experts. Three basic axioms were given, and the influence of a principals goal attainment on an experts payoff was discussed. Comparative analysis of several game models was carried out. The results show that, the principals optimal choice is the game model with experts payoff which contains a deviation penalty function. In addition, the domain of definition of deviation penalty function is only part of the deviation interval. The experts optimal choice is to invest constantly until the deviation of estimation satisfying the request of principal. Finally, the two equilibriums are both achieved. The principal-agent equilibrium satisfies incentive compatibility constraint, thus realizing the benefits of both the principal and the agent.
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