(A) model of decision making with biased information of an agent

Abstract

This thesis suggests a practical way of decision making in real-world problems concerning hiring agents. In this thesis a decision maker``s optimal decision process is derived when he is confronted with biased information of an agent under the situation that the bias is caused mainly by the difference of the decision maker``s and agent``s utilities. In developing this model, we use the concept of the expert use and scoring rule to provide the agent with an incentive to make honest transmission of information. And the concept of expected regret is introduced to evaluate the value of getting information from the agent. Comparing with Green``s model, the advantages of this model are also shown.