Collusion of Agents and Its Control under Asymmetric Information

By applying the game theory and the information economics, the effects of collusion on the incentive mechanism from a principal under the conditions of multi-agent and asymmetric information were investigated. It was pointed out that if there is no collusion among agents, a principal may raise the incentive by comparingtheir performances, nevertheless, the existence of collusionwillweaken the incentive effect. In addition, if a principal can detect and restrict the collusion, its situation can be improved.