Global approximations for principal agent theory

Principal Agent Theory (PAT) seeks to identify incentives and sanctions that a consumer should offer a producer as part of a contract in order to maximise the former's utility. However, identifying optimal contracts in large systems is difficult, particularly when little information is available about producer competencies. In this work we propose that a global contract be used to govern such interactions, derived from the properties of a representative agent. After describing how such a contract can be obtained, we analyse the contract utility space and its properties. Finally, we suggest how our work can be integrated with existing work on multi-agent systems.