# Harnessing Information in Incentive Design

arXiv: https://arxiv.org/abs/2509.02493 · HTML: https://mlsanity.com/paper/2509.02493/

## Key facts

- Cited by 1 papers in the map (data through 14 Oct 2026).
- First posted on arXiv 2 Sep 2025.

## Built on by (most cited first, 1 of 1)

- [Adaptive Agent Design](https://mlsanity.com/paper/2609.12486/) (2026)

## Abstract (arXiv)

Incentive design deals with interaction between a principal and an agent where the former can shape the latter's utility through a policy commitment. It is well known that the principal faces an information rent when dealing with an agent that has informational advantage. In this work, we embark on a systematic study of the effect of information asymmetry in incentive design games. Specifically, we first demonstrate that it is in principal's interest to decrease this information asymmetry. To mitigate this uncertainty, we let the principal gather information either by letting the agent shape her belief (aka Information Design), or by paying to acquire it. Providing solutions to all these cases we show that while introduction of uncertainty increases the principal's cost, letting the agent shape its belief can be advantageous. We study information asymmetry and information acquisition in both matrix games and quadratic Gaussian game setups.