Holmström's theorem
id:
holmstr-m-s-theorem-254-10004440
title:
Holmström's theorem
text:
In economics, Holmström's theorem is an impossibility theorem or trilemma attributed to Bengt R. Holmström proving that no incentive system for a team of agents can make all of the following true: Income equals outflow,
The system has a Nash equilibrium, and
The system is Pareto efficient. Thus a Pareto-efficient system with a balanced budget does not have any point at which an agent can not do better by changing their effort level, even if everyone else's effort level stays the same, meaning th
brand slug:
wiki
category slug:
encyclopedia
description:
Impossibility of efficient incentive systems
original url:
https://en.wikipedia.org/wiki/Holmstr%C3%B6m%27s_theorem
date created:
date modified:
2024-03-23T18:40:01Z
main entity:
{"identifier":"Q3984020","url":"https://www.wikidata.org/entity/Q3984020"}
image:
fields total:
13
integrity:
14