Statistical basis of incentive mechanism
Fang Liu · Journal of Dalian Maritime University · 2007
Mathematical statistics is widely used in incentive theory,to some extent the design of incentive mechanism is to solve the inferential problem on agents' ability and effort under asymmetric information.Starting from benchmark model of incentive mechanism,the paper discussed the statistical backgrounds of First Order Condition and Likelihood Ratio Condition,the information meaning of Sufficient Statistics and its derivation in Relative Performance Evaluation,and the improvement on incentive allocation by Large Sample theory and Bayes Estimation under multi-period.