Principal–Agent Alignment

slug: transparency

slug: signaling

components:
Principal Goal Specification
Agent Role and Discretion Boundary
Incentive Alignment Structure
Observability and Monitoring Plan
Performance Metric Set
Information Reporting Channel
Accountability and Consequence Path
Conflict-of-Interest Control
Risk-Sharing Rule
Trust and Autonomy Calibration
Escalation Threshold
Beneficiary Feedback Loop
Replacement or Exit Path

mechanisms:
Performance Contract
Service-Level Agreement
Incentive Compensation Plan
Audit or Review Cycle
Reporting Requirement
Fiduciary Duty Rule
Decision-Rights Matrix
Governance Board
Clawback Clause
Reputation System
Escalation Protocol

essence_one_line: Align agent incentives, information, discretion, and accountability with the principal's goals without requiring perfect monitoring.

compression_statement: When a principal delegates action to an agent who has private information, independent incentives, or discretionary control, principal–agent alignment defines goals, authority boundaries, incentives, reporting, monitoring, and consequences so the agent's rational local behavior is more likely to serve the principal's intended outcome.

core_intuition: Delegation creates leverage, but it also creates distance between intent and action. Alignment works by turning vague trust into a structured relationship: the agent knows what outcome matters, has bounded discretion to act, receives incentives that fit the goal, reports enough information for oversight, and faces credible consequences when behavior diverges.

canonical_formula: delegated_action + divergent_information_or_incentives -> goal_specification + discretion_boundary + incentive_structure + monitoring/reporting + accountability -> delegated_action_that_tracks_principal_intent

structural_problem: A principal depends on an agent to act on the principal's behalf, but the agent has private information, hidden action, independent incentives, local priorities, conflicts of interest, or discretion that can move behavior away from the principal's intended goals.

condition: A principal cannot personally perform, observe, or verify all relevant work.

why_it_matters: The archetype is activated by delegated action; without delegation, the problem is usually direct decision quality rather than agency alignment.

condition: The agent has discretion over effort, timing, quality, risk, representation, resource use, or tradeoffs.

why_it_matters: If the agent has no discretion, the main design problem is process control, not principal-agent alignment.

condition: The agent's private incentives differ from the principal's desired outcome.

why_it_matters: Misalignment can come from pay, career incentives, risk exposure, reputation, workload, organizational politics, or personal interest.

condition: The principal cannot fully observe action quality or distinguish bad luck from bad effort.

why_it_matters: Imperfect observability is what makes simple instruction insufficient.

condition: The delegation relationship is important enough to justify governance costs.

why_it_matters: Alignment mechanisms add measurement, reporting, contracting, or oversight burden and should be proportional to stakes.

condition: There is a meaningful target outcome, duty, mission, or interest that the agent's behavior should track.

why_it_matters: Alignment requires a reference point; vague principal preferences produce vague and gameable controls.

symptom: Agents optimize visible metrics while neglecting the principal's real goal.

interpretation: The measurement and incentive structure rewards proxy success rather than mission success.

symptom: The principal repeatedly discovers problems late, after the agent's choices have become expensive to reverse.

interpretation: Reporting, monitoring, and escalation paths are too weak for the level of delegated discretion.

symptom: Agents take risks whose upside accrues to them while downside is borne by the principal or by third parties.

interpretation: Risk and reward are separated, often creating moral-hazard-like behavior.

symptom: The agent says they followed instructions, while the principal says the intended purpose was violated.

interpretation: Authority boundaries and goal interpretation were under-specified.

symptom: Trust depends entirely on personal relationships rather than durable rules.

interpretation: Alignment is informal and may collapse when actors, incentives, or scale change.

symptom: High performers leave or avoid the role because controls feel punitive, arbitrary, or miscalibrated.

interpretation: Oversight may be heavy enough to damage autonomy, morale, or legitimate judgment.

symptom: Conflicts of interest are disclosed only after decisions have already been made.

interpretation: The system lacks early conflict screening, recusal, or independent review.

root_tension: Delegation is necessary because agents have local capacity, expertise, or access, but delegation separates intention from action and gives the agent opportunities to optimize for something other than the principal's real interest.

case: The actors are peers negotiating shared rules rather than one party acting for another.

why_not: Incentive-compatible rule design, commons governance, or mechanism design may be closer when there is no principal-agent delegation relation.

case: The core issue is that all participants face the same bad payoff structure.

why_not: Payoff restructuring is closer when there is a systemwide incentive problem, not delegated action under asymmetric information.

case: The main problem is selecting the right agent before delegation begins.

why_not: Hidden type screening or credible signaling may be primary when the central challenge is identifying ability, honesty, or fit before appointment.

case: The agent has no meaningful discretion and merely follows a deterministic process.

why_not: Process standardization, poka_yoke, or auditability may be more relevant than incentive alignment.

case: The principal's goal itself is harmful, exploitative, illegal, or illegitimate.

why_not: Alignment would make harmful delegation more effective; legitimacy and ethics review must come first.

case: The principal already observes all relevant actions and outcomes cheaply.

why_not: Direct supervision or ordinary performance management may suffice without a full agency-alignment architecture.

structural_intervention: Redesign the delegation relationship so the agent receives clear goals, bounded authority, aligned incentives, fit-for-purpose information reporting, proportional monitoring, and credible accountability while preserving enough discretion for expert or local judgment.

logic: Name who delegates, who acts, who bears consequences, and whose interests or mission the agent is supposed to serve.

logic: Translate vague preference into explicit outcomes, duties, constraints, and tradeoffs so the agent knows what success means beyond a narrow metric.

logic: Identify what the agent knows or controls that the principal cannot easily observe, including hidden effort, hidden risk, hidden quality, and conflicts.

logic: Give the agent enough discretion to perform the role while specifying permissions, forbidden actions, approval thresholds, and escalation triggers.

logic: Link compensation, recognition, renewal, reputation, resources, liability, or privileges to outcomes and behaviors that reflect the principal's actual goal.

logic: Require evidence, logs, audits, reviews, dashboards, or check-ins at a level proportional to stakes, uncertainty, and reversibility.

logic: Specify consequences, remediation, appeal, review, replacement, or clawback mechanisms so deviation can be corrected without relying only on trust.

logic: Check whether the agent can maximize the measured target while undermining the real goal, and whether oversight costs destroy useful autonomy.

logic: Adjust metrics, incentives, authority, and monitoring as the principal learns which controls predict real performance and which produce gaming or paralysis.

rule: Align to the real objective, not merely to the easiest observable proxy.

rationale: The more incentives attach to a metric, the more likely the metric becomes a target to be gamed.

rule: Make monitoring proportional to stakes, uncertainty, and reversibility.

rationale: Heavy monitoring can destroy autonomy and trust; weak monitoring can leave hidden action unchecked.

rule: Separate permission boundaries from performance incentives.

rationale: A clear authority limit prevents catastrophic choices even when the agent has strong incentives to perform.

rule: Reward behaviors the agent can influence and outcomes the principal actually values.

rationale: Punishing agents for uncontrollable noise encourages concealment, risk aversion, or opportunistic avoidance.

rule: Treat conflict-of-interest control as a precondition when the agent serves multiple masters or holds side incentives.

rationale: Incentive alignment cannot work if the agent's private stake silently dominates the delegated duty.

rule: Preserve appeal and review when consequences are severe.

rationale: Accountability without procedural fairness becomes arbitrary control.

rule: Revisit alignment after context changes.

rationale: Incentive systems that worked at one scale, risk level, or maturity stage can fail after growth, automation, market change, or mission drift.

description: The agent and overseers can explain which goal, duty, or beneficiary the delegated action is meant to serve.

description: The agent retains enough judgment to act effectively but cannot unilaterally take decisions outside the delegated envelope.

description: The agent is not pushed to optimize a visible proxy while damaging the underlying outcome.

description: Oversight gathers enough evidence to manage risk without becoming arbitrary, invasive, or more costly than the problem.

description: Consequences for deviation are known, enforceable, and subject to appropriate review rather than improvised after failure.

description: The alignment system does not align principal and agent by shifting hidden harm to clients, citizens, patients, users, workers, or the environment.

outcome: Delegated decisions better track the principal's intended goals and constraints.

outcome: Hidden action, shirking, self-dealing, quality degradation, and unmanaged risk become easier to detect and correct.

outcome: Agents have clearer authority, better feedback, and fewer incentives to game proxies or conceal bad news.

outcome: Principals can scale expertise and local action without relying on perfect observation or personal trust alone.

outcome: Oversight burden becomes more targeted, because monitoring focuses on the most consequential asymmetries and failure points.

prose_essence:
Principal–Agent Alignment is the pattern for making delegated action track delegated intent. A principal needs another actor to act on their behalf, but the agent usually has more local information, more immediate control, and their own incentives. The archetype does not assume perfect trust or perfect surveillance. It builds a relationship in which the agent knows the goal, has bounded discretion, receives aligned incentives, reports meaningful information, and faces credible accountability.

The core move is to replace vague delegation with an alignment architecture. The principal's real goal is made legible; the agent's authority is scoped; the incentive structure is checked against the real objective; hidden action is made observable enough for review; conflicts are controlled; and consequences are defined before failure occurs.

prose_when_to_use:
Use this archetype when one party depends on another party, team, institution, contractor, professional, or automated system to act on its behalf and cannot fully observe the quality, effort, risk, or loyalty of that action. It is especially useful when the agent has expertise or access that the principal lacks, but also has reasons to optimize for a different objective.

Common triggers include delegated professional judgment, outsourced services, executive authority, grant administration, public program implementation, contractor management, automated task execution, investment advice, clinical care, or any setting where hidden effort, hidden quality, hidden risk, or conflicts of interest could distort action.

Do not use this archetype merely because incentives exist. Use it when there is a delegation relationship: someone acts for someone else, and the gap between intent and action can create loss, harm, drift, or betrayal.

prose_structural_problem:
Delegation creates leverage and vulnerability at the same time. The principal delegates because the agent has capacity, expertise, location, time, authority, or specialized knowledge. That same distance means the principal cannot perfectly observe whether the agent is acting diligently, honestly, prudently, and in line with the principal's goal.

The structural problem has several common pieces. The principal has an intended outcome or duty. The agent has discretion. The principal cannot fully observe action or quality. The agent has local incentives that may diverge from the principal's goal. Results may be delayed, noisy, or ambiguous. The agent may know more than the principal about what happened and why.

This can produce shirking, self-dealing, quality degradation, excessive risk taking, concealment of bad news, proxy gaming, or formal compliance that violates the purpose of the delegation.

prose_intervention_logic:
The intervention begins by naming the relationship: who is the principal, who is the agent, who is the beneficiary, and what delegated duty or outcome is at stake. It then makes the principal's real goal explicit enough to guide action and review.

Next, it maps the asymmetry. What does the agent know that the principal does not? What choices can the agent make without being seen? What risks can the agent shift? What conflicts might distort judgment? What outcomes can be measured, and which important values are hard to measure?

The design then chooses a set of alignment levers. Authority boundaries prevent some actions from being taken without approval. Incentives make desired behavior locally rational. Reporting and monitoring make hidden action more visible. Metrics provide evidence, but they are paired with judgment to avoid proxy gaming. Accountability and consequence paths make correction credible. Conflict controls prevent side interests from dominating delegated duty.

The final step is calibration. Too little control leaves agency drift unchecked. Too much control destroys autonomy, initiative, and trust. A good design fits the stakes, risk, reversibility, expertise, and maturity of the relationship.

prose_key_components:
### Principal Goal Specification

The principal goal specification states what the agent is actually supposed to serve. It may be a financial outcome, a patient interest, a public mission, a service standard, a research purpose, or a duty of care. Without this component, the agent can satisfy a literal instruction while missing the intended purpose.

### Agent Role and Discretion Boundary

The agent role and discretion boundary defines what the agent may decide independently, what requires approval, and what is outside the mandate. This component matters because incentives alone cannot safely govern every action. Some decisions need reserved powers, escalation thresholds, or hard prohibitions.

### Incentive Alignment Structure

The incentive alignment structure connects rewards, penalties, renewal, reputation, access, liability, or recognition to behaviors and outcomes that reflect the principal's goal. It must be designed carefully: if incentives are narrow or short-term, the agent may optimize the metric rather than the real outcome.

### Observability and Monitoring Plan

The observability and monitoring plan specifies what evidence will make agent action visible enough for governance. This can include logs, audits, peer review, inspections, check-ins, dashboards, status reports, or sample reviews. Monitoring should be proportional to risk; surveillance is not the same as alignment.

### Performance Metric Set

The performance metric set provides indicators for quality, effort, timeliness, safety, risk, or mission fit. Metrics are useful because they make invisible performance discussable, but they are dangerous when treated as a complete representation of value. A metric should be tested for controllability, validity, and gaming risk.

### Information Reporting Channel

The information reporting channel creates a recurring path for the agent to surface status, exceptions, conflicts, uncertainty, and bad news. A strong reporting channel is not merely a paperwork requirement. It makes the relationship resilient by giving the principal enough information to intervene before drift becomes failure.

### Accountability and Consequence Path

The accountability and consequence path defines what happens when the agent deviates, underperforms, hides information, violates boundaries, or discovers a conflict. It includes correction, remediation, sanction, appeal, replacement, or redesign. Accountability is strongest when consequences are known before failure, not invented afterward.

### Conflict-of-Interest Control

Conflict-of-interest control identifies and manages side incentives, divided loyalties, or self-dealing opportunities. Disclosure may be useful, but some conflicts require recusal, role separation, independent review, prohibition, or altered compensation. This component prevents the agent's private stake from silently displacing the delegated duty.

prose_common_mechanisms:
Performance contracts implement the archetype by recording goals, metrics, reporting obligations, incentives, and consequences in a formal agreement. They are useful when a relationship is important, repeated, and negotiable.

Service-level agreements are a domain-specific contract mechanism for outsourced or operational work. They translate delegated service expectations into response times, quality standards, uptime, support, remedies, and reporting.

Incentive compensation plans implement the incentive side of the archetype. They can motivate effort and goal focus, but they are not the whole archetype. Without authority boundaries, monitoring, and proxy-gaming safeguards, incentive pay can make misalignment worse.

Audits and review cycles implement the observability side of the archetype. They examine evidence and exceptions after action has occurred. They work best when paired with clear duties and correction paths; otherwise they become ceremonial compliance.

Reporting requirements implement the information-flow component. They make status, risk, conflicts, and exceptions visible at a defined cadence. A reporting requirement should produce usable evidence, not merely paperwork.

Fiduciary duty rules implement a duty-based variant of the archetype. They are common when agents handle another party's assets, welfare, legal interest, or professional trust. The duty is a mechanism or institution, not the entire archetype.

Decision-rights matrices implement authority boundaries. They specify who decides, who approves, who must be consulted, and who is informed. They are especially useful when the main misalignment risk is unauthorized discretion.

Governance boards implement oversight when the principal cannot directly monitor or when legitimacy requires collective review. They can appoint, evaluate, escalate, discipline, or replace agents.

Clawback clauses implement delayed accountability. They allow rewards to be reversed when later evidence shows misconduct, hidden risk, misrepresentation, or invalid results.

Reputation systems implement repeated-interaction accountability by making past behavior visible. They support selection and monitoring, but they cannot define the real goal or authority boundary by themselves.

Escalation protocols implement boundary-sensitive control. They tell the agent when ordinary discretion ends and principal review, peer review, or emergency authorization begins.

prose_failure_modes:
Proxy gaming occurs when the agent optimizes the measured target while undermining the real goal. Mitigation requires multiple metrics, qualitative review, beneficiary feedback, audit sampling, and redesign of metrics that become targets.

Surveillance overreach occurs when monitoring becomes constant, invasive, punitive, or unrelated to actual risk. Mitigation requires proportionality, privacy limits, purpose limits, and appeal rights.

Responsibility blurring occurs when authority and consequence paths are unclear. Mitigation requires decision-rights matrices, escalation thresholds, and explicit accountability chains.

Uncontrollable outcome penalties occur when agents are punished for outcomes they cannot reasonably influence. Mitigation requires risk adjustment, controllability testing, and a mix of outcome and process evidence.

Conflict disclosure theater occurs when conflicts are merely disclosed but not actually controlled. Mitigation requires recusal, independent review, role separation, prohibition, or altered incentives.

Principal misconduct amplification occurs when the system aligns agents to an illegitimate or harmful goal. Mitigation requires rights constraints, ethics review, whistleblower paths, and independent oversight.

Bureaucratic paralysis occurs when approvals and documentation become so heavy that action becomes slow or defensive. Mitigation requires risk-based controls and periodic review of administrative burden.

Agent lock-in occurs when the principal cannot replace or discipline the agent because knowledge, systems, relationships, or data are trapped. Mitigation requires documentation, portability, exit rights, succession planning, and periodic capability review.

prose_neighbor_distinctions:
Principal–Agent Alignment is distinct from Moral Hazard Mitigation. Moral hazard is usually about hidden action after downside risk is shifted. Principal-agent alignment is broader: it covers goals, authority, incentives, monitoring, reporting, conflicts, and consequences across many delegation relationships.

It is distinct from Payoff Restructuring. Payoff restructuring changes incentives anywhere. Principal-agent alignment changes incentives inside a delegation relationship and must also manage information asymmetry and authority.

It is distinct from Incentive-Compatible Rule Design. Incentive-compatible rule design can apply to auctions, matching, voting, or strategic systems without a principal-agent relationship. Principal-agent alignment applies when one actor acts on behalf of another.

It is distinct from Delegated Authority Envelope. A delegated authority envelope defines permission boundaries. Principal-agent alignment uses that boundary but also includes incentives, monitoring, reporting, and accountability.

It is distinct from Hidden Type Screening. Screening helps choose an agent before delegation. Principal-agent alignment governs behavior after the agent has been selected.

It is distinct from Credible Signaling. Signals help a principal infer agent quality or trustworthiness. Alignment defines and governs the ongoing relationship.

prose_cross_domain_examples:
In corporate governance, executives act with broad discretion while boards and owners cannot observe every decision. Long-term incentives, audit committees, risk limits, disclosure, and removal authority are mechanisms for aligning delegated executive action with institutional goals.

In healthcare, clinicians and care teams hold expertise and discretion. Clinical guidelines, peer review, informed consent, quality metrics, patient feedback, and escalation paths align professional action with patient welfare and safety.

In public contracting, a city may hire a contractor to maintain infrastructure. Service levels, inspections, public reporting, penalties, renewal criteria, and resident feedback align the contractor's local choices with public value.

In nonprofit grantmaking, grantees often know local conditions better than funders. Milestone funding, learning reviews, community feedback, reporting, and flexible revision help preserve mission fit without micromanagement.

In software automation, a tool or agent may act on behalf of operators. Scoped permissions, logs, approval thresholds, rollback capability, and periodic review align automated action with human intent and safety constraints.

prose_non_examples:
A marketplace that adds search filters and escrow to help buyers and sellers transact is not primarily Principal–Agent Alignment. That is Transaction Cost Reduction unless one party is acting on behalf of another.

A pollution tax is not primarily Principal–Agent Alignment. It is Externality Internalization because the issue is spillover cost outside the decision boundary.

A team collectively choosing norms for a shared resource is not primarily Principal–Agent Alignment. It is Commons Governance when the problem is shared-resource depletion or overuse.

A firm screening applicants before hiring is not primarily Principal–Agent Alignment. It is closer to Hidden Type Screening or Credible Signaling until delegation begins.

A simple checklist for a rote process is not necessarily Principal–Agent Alignment. If the agent has little discretion and no independent incentive, process standardization or error-proofing may be more relevant.

prose_tradeoffs:
The central tradeoff is autonomy versus control. Alignment mechanisms reduce drift, but too much control can crush judgment and initiative.

A second tradeoff is measurement versus meaning. Metrics make behavior visible, but they can also narrow attention to what is measurable.

A third tradeoff is incentive power versus distortion. Strong incentives produce effort and focus, but they can also encourage short-termism, concealment, and risk seeking.

A fourth tradeoff is trust versus verification cost. Verification protects the principal, but it consumes time and can signal distrust.

A fifth tradeoff is principal control versus beneficiary voice. Some principals are poor proxies for the people affected by the agent's work, so the design may need beneficiary feedback or independent review.

prose_invariants_to_preserve:
The principal's intent must remain legible. The agent, principal, and reviewer should be able to state what goal, duty, or beneficiary interest the agent is meant to serve.

The agent must retain sufficient but bounded discretion. If all discretion is removed, the principal loses the reason for delegation. If no boundary exists, the agent can redefine the role.

Incentives must not reward goal substitution. A design that rewards the metric while sacrificing the mission is a failed alignment system even if the metric improves.

Monitoring must be proportional and auditable. Oversight should reveal meaningful risk without becoming arbitrary, invasive, or more costly than the agency problem itself.

Accountability must be credible and fair. Agents should know what consequences follow from deviation, and serious consequences need review and appeal.

Beneficiaries and third parties must not be erased. The archetype should not align principal and agent by pushing hidden costs onto patients, citizens, customers, workers, users, or the environment.

prose_target_outcomes:
A working design makes delegated action more likely to serve the intended goal. It reduces hidden shirking, self-dealing, unmanaged risk, quality degradation, and late discovery of problems.

It also makes the agent's role clearer. The agent knows what they can decide, when to escalate, what evidence is expected, how performance will be judged, and what tradeoffs are unacceptable.

At system level, the principal gains scalable trust. They can rely on agents, contractors, professionals, institutions, or automated systems without needing to personally observe every action.

prose_parameter_dimensions:
The first tuning dimension is discretion. Agents need enough autonomy to use expertise, but not so much that they can silently change the principal's risk exposure or objective.

The second dimension is incentive strength. Weak incentives may not change behavior; strong incentives may invite gaming, excessive risk, or neglect of unmeasured values.

The third dimension is monitoring intensity. Low-risk, reversible delegations may need light sampling or periodic reports. High-stakes, opaque, or irreversible actions may need logs, audits, approvals, and independent review.

The fourth dimension is metric mix. A design can emphasize outcomes, behaviors, process quality, risk indicators, beneficiary feedback, or long-term results. The mix should reflect what the agent can control and what the principal actually values.

The fifth dimension is consequence severity. Consequences need to be credible, but severe consequences require stronger evidence, procedural fairness, and appeal.

The sixth dimension is time horizon. Short-term incentives may be useful for responsiveness, while long-term incentives, delayed review, or clawbacks protect against deferred harm.

The seventh dimension is conflict tolerance. Some conflicts can be disclosed and managed; others require recusal, role separation, or prohibition.

prose_variants_and_near_names:
Outcome-Based Incentive Alignment emphasizes pay, renewal, promotion, or penalty linked to outcomes. It works only when outcomes are meaningful, controllable, and protected against proxy gaming.

Monitoring-Based Alignment emphasizes audits, logs, reviews, inspections, and reporting. It is useful when hidden action or hidden quality is central, but it can become surveillance if poorly calibrated.

Fiduciary Stewardship Alignment emphasizes duties of loyalty, care, disclosure, and conflict control. It is common in professional and trustee-like relationships.

Delegated Authority Alignment emphasizes decision rights, approval thresholds, and escalation protocols. It is useful when the main risk is unauthorized or boundary-crossing action.

Beneficiary Feedback Alignment adds evidence from people affected by the agent's action. It is important when the principal is distant from lived impact.

Near names include agency alignment, agency cost reduction, delegated goal alignment, principal-agent governance, management control, and performance management. These should usually point back to the parent archetype or one of its variants rather than becoming separate archetypes.

Outcome-Based Incentive Alignment

variant_type: subtype

short_definition: Align the agent through rewards or consequences linked to outcomes the principal values.

distinctive_feature: The primary alignment lever is the relationship between measured outcomes and agent reward, renewal, promotion, or penalty.

distinct_from_parent: The parent includes authority boundaries, reporting, conflict control, and monitoring; this variant emphasizes outcome-linked incentives.

still_same_parent_because: It remains a way of aligning delegated action under asymmetric information.

use_when: Outcomes are observable enough to measure or verify without excessive delay.

use_when: The agent can materially influence the outcome.

use_when: The principal can protect against proxy gaming and uncontrollable noise.

Performance Metric Set

role: Supplies measurable indicators that can be linked to incentives.

Incentive Alignment Structure

role: Translates performance evidence into rewards or consequences.

Incentive Compensation Plan

role: Implements outcome-linked reward or promotion rules.

Clawback Clause

role: Corrects rewards later shown to depend on misrepresentation or hidden risk.

example_domains:
executive compensation
vendor service contracts
grant milestone funding

domain: vendor management

example: A supplier receives renewal and bonuses only when quality, response, and safety targets are met together.

failure_modes: Agents optimize the metric while damaging unmeasured values.

failure_modes: Agents avoid worthwhile risks because downside is over-penalized.

Monitoring-Based Alignment

short_definition: Align agent behavior by making action, quality, risk, or compliance visible enough for review and correction.

distinctive_feature: The alignment lever is increased observability and periodic review rather than primarily financial incentives.

distinct_from_parent: The parent includes many levers; this variant centers monitoring and evidence.

still_same_parent_because: Monitoring is used to govern delegated action in service of a principal's goal.

use_when: The agent's hidden action or hidden quality is the main risk.

use_when: Direct outcome measurement is delayed, noisy, or incomplete.

use_when: Sampling, logs, peer review, or audits can reveal meaningful evidence.

Observability and Monitoring Plan

role: Defines what evidence must be visible and how often.

Information Reporting Channel

role: Ensures the agent provides interpretable information to the principal.

Audit or Review Cycle

role: Periodically checks records, results, and exceptions.

Reporting Requirement

role: Creates a recurring evidence flow.

example_domains:
clinical quality review
public program oversight
software operations logs

domain: operations

example: A delegated operations team publishes exception logs and participates in monthly risk reviews.

failure_modes: Surveillance burden destroys trust and autonomy.

failure_modes: Agents learn to stage visible evidence while hiding real problems.

Fiduciary Stewardship Alignment

short_definition: Align agents by imposing duties of loyalty, care, disclosure, and stewardship toward a beneficiary's interest.

distinctive_feature: The central lever is a duty-based role rather than only a performance metric.

distinct_from_parent: The parent covers many delegation settings; this variant emphasizes formal or norm-based duties of care and loyalty.

still_same_parent_because: Fiduciary stewardship is a specialized way to align an agent with a principal or beneficiary when direct observation is limited.

use_when: The agent controls assets, decisions, or professional judgment for a less informed beneficiary.

use_when: Conflicts of interest and self-dealing are salient risks.

use_when: Legal, professional, or institutional duties can be defined and enforced.

Conflict-of-Interest Control

role: Prevents side interests from overriding the beneficiary's interest.

Accountability and Consequence Path

role: Makes violations of duty reviewable and sanctionable.

Fiduciary Duty Rule

role: Formalizes duties of loyalty, care, and disclosure.

example_domains:
trusteeship
legal representation
medical care
asset management

domain: professional services

example: An advisor must disclose conflicts and act in the client's interest rather than simply sell the highest-commission product.

failure_modes: Duties become symbolic if enforcement and evidence are weak.

Delegated Authority Alignment

short_definition: Align an agent by carefully defining decision rights, approval thresholds, reserved powers, and escalation obligations.

distinctive_feature: The central alignment lever is authority design rather than reward or monitoring.

distinct_from_parent: The parent also includes incentives and information; this variant foregrounds discretion boundaries and decision rights.

still_same_parent_because: The authority envelope is a core component of aligning delegated action.

use_when: The main risk is that the agent may take decisions outside the intended scope.

use_when: The agent needs autonomy in normal cases but must escalate exceptions.

use_when: The delegation boundary can be written, taught, and enforced.

Agent Role and Discretion Boundary

role: Specifies permissions, limits, and escalation.

Escalation Threshold

role: Triggers principal review in high-risk or unusual cases.

Decision-Rights Matrix

role: Documents decision authority across cases.

Escalation Protocol

role: Defines the handoff when authority boundaries are approached.

example_domains:
management delegation
public administration
AI tool permissions

domain: software automation

example: An automation can restart a service but must request human approval before deleting data or changing access rights.

failure_modes: Boundaries are so narrow that the agent cannot use expertise or local knowledge.

Beneficiary Feedback Alignment

short_definition: Align agents by adding feedback from the people or systems affected by the agent's delegated action.

distinctive_feature: The evidence source is not only the agent or principal but affected beneficiaries.

distinct_from_parent: The parent may monitor from the principal's perspective; this variant adds beneficiary-side evidence to correct blind spots.

still_same_parent_because: Beneficiary feedback is used to align delegated action with the intended interest.

source_primes: feedback accountability agency_problem

use_when: The principal is distant from lived impact or service quality.

use_when: Beneficiaries can report meaningful evidence of fit, harm, quality, or trust.

use_when: Feedback can be gathered safely without retaliation or distortion.

Beneficiary Feedback Loop

role: Captures lived-impact signals from affected parties.

Reporting Requirement

role: Can include beneficiary-reported evidence and complaints.

example_domains:
public services
healthcare
education
customer support

domain: public services

example: A service contractor's evaluation includes resident complaints, response quality, and independent inspection rather than only contractor reports.

failure_modes: Feedback becomes performative, cherry-picked, or unsafe for beneficiaries.

near_names:
Agency Alignment
Agency Cost Reduction
Delegated Goal Alignment
Principal–Agent Governance
Performance Management
Management Control


Principal-Bound Authority Mediation

type: archetype

source: generated

batch: Batch 06

slug: authentication

slug: traceability

slug: authority

slug: provenance

slug: validation

slug: boundary

slug: consent

slug: agency

slug: accountability

slug: verification

slug: evidence

slug: containment

slug: observability

slug: attestation

slug: supersession

components:
Originating Principal Claim
Request Intent Scope
Deputy Execution Authority
Principal Authority Coupling Rule
Ambient Authority Exclusion
Delegation Context Record
Request Provenance Trace
Deny or Step-Up Default
Accountability Binding Record
User Presence or Consent Signal
Authority-Carrying Capability
Tenant or Subject Partition
Abuse-Case Probe Set

mechanisms:
CSRF Token Challenge
Origin and Referer Gate
Signed Delegation Token
On-Behalf-Of Authorization Flow
Object-Capability Reference
Scoped Service-Account Impersonation
Policy-Engine Subject Binding Check
Delegation Audit Log
Confused-Deputy Abuse-Case Test

essence_one_line: Let a deputy act only when the requesting principal, stated intent, delegated scope, and use of the deputy’s authority are explicitly bound and checkable.

compression_statement: When a service, proxy, agent, official, workflow, or credentialed intermediary can perform actions that an outsider cannot perform directly, treat the request as a three-party authority problem. Identify who originated the request, what action and purpose are being requested, what authority the originator has for that action, what authority the deputy would use to execute it, and whether a policy allows the deputy to spend that authority on the originator’s behalf. Reject or step up when the binding is absent, stale, overbroad, or unauditable.

core_intuition: The deputy is not confused because it lacks power; it is confused because it loses track of whose will and whose authority it is serving. A cookie, service credential, staff role, proxy channel, or administrative account may prove that the deputy can act, but not that the originator may borrow that power for this action. The remedy is to make borrowed authority explicit, scoped, fresh, and attributable.

canonical_formula: Execute D(action) only if bind(P, I, S, A_d, C, T) passes policy, where P is the originating principal, I is request intent, S is permitted scope for P, A_d is deputy execution authority, C is delegation/context evidence, and T is current freshness/use context. Otherwise deny, constrain, challenge, or escalate.

structural_problem: A privileged intermediary receives a request influenced by an actor that lacks the necessary authority. Because the intermediary checks only its own permissions, ambient credentials, or local validity rules, it performs an action the originator could not legitimately perform. Authority crosses the boundary through the deputy without an explicit record of whose intent, scope, and authorization justified the action.

trigger_conditions: An intermediary, proxy, service, role, official, agent, workflow, or automated process has more authority than at least some request originators.

trigger_conditions: Requests can be initiated, shaped, replayed, forwarded, embedded, or disguised by actors who do not themselves possess the deputy’s authority.

trigger_conditions: The deputy can confuse ambient credentials, channel access, session presence, or internal service trust with request-specific authorization.

trigger_conditions: The action is sensitive enough that authorization must depend on the originator and purpose, not merely on the deputy’s ability to perform it.

trigger_conditions: A cross-boundary request path strips, blurs, or fails to carry originator identity, tenant context, consent, authority scope, or user intent.

trigger_conditions: Audit or accountability would otherwise record only the deputy’s execution, not the principal who caused or benefited from it.

symptoms: A service account, administrator role, browser session, proxy, or approval office performs a sensitive action for a requester who could not do it directly.

symptoms: Logs show which intermediary executed an action but not the user, client, tenant, beneficiary, or external actor that induced it.

symptoms: A defense checks authentication but not whether the authenticated channel represents intentional authorization for this action.

symptoms: Internal trust between services causes a downstream service to accept requests without preserving the upstream caller’s scope.

symptoms: An approval, document, token, or credential is replayed outside its intended purpose or subject because the deputy treats possession as authority.

symptoms: Security reviews find broad service accounts, ambient permissions, or confused proxy flows but cannot identify a single broken rule inside the deputy.

symptoms: Users or principals are held responsible for actions they did not intentionally authorize, or the deputy escapes accountability by blaming the requester.

root_tension: The deputy legitimately needs authority to serve requests, but that same authority becomes dangerous when it is ambient, unscoped, and detachable from the originator’s intent. The system must allow useful mediation while preventing authority laundering through the mediator.

anti_signatures: The actor directly possesses the needed authority and the problem is merely whether the credential is valid; use evidence_bound_authentication or access-control patterns.

anti_signatures: The problem is only that permissions are too broad, with no outsider-originated request borrowing the deputy’s power; use least_privilege_access_design.

anti_signatures: The problem is only stale state between check and use; use use_time_precondition_binding.

anti_signatures: The problem is long-run incentive misalignment between principal and agent, not request-level authority laundering; use principal_agent_alignment.

anti_signatures: The problem is simply assigning who may decide what; use decision_rights_clarification unless a privileged intermediary is being induced to act for an unprivileged originator.

anti_signatures: The deputy is malicious or compromised and intentionally abuses authority; this archetype may support containment, but the primary problem is not confusion.

structural_intervention: Insert a principal-bound mediation layer at the deputy boundary. The layer preserves originator identity and intent, checks the originator’s permitted scope for the requested action, constrains or removes ambient deputy authority, verifies freshness and delegation context, executes under the narrowest authority compatible with the principal’s scope, and records who caused what under which policy.

action_logic: Map the deputy, the requester/originator, the protected resource, and the action classes the deputy can perform.

action_logic: Separate deputy execution capability from the originator’s authorization to cause a particular action.

action_logic: Require a request-bound principal claim, tenant/context claim, purpose or intent scope, and freshness signal before sensitive execution.

action_logic: Evaluate the requested action against the originator’s authority, not merely the deputy’s standing privileges.

action_logic: Narrow execution to the least authority that satisfies both the originator’s scope and the deputy’s operational need.

action_logic: Forbid ambient authority from silently substituting for explicit delegation; pass capabilities, on-behalf-of tokens, scoped policies, or user-presence evidence instead.

action_logic: Deny, challenge, step up, or escalate when the principal, intent, scope, freshness, or delegation chain is missing or contradictory.

action_logic: Record the principal, deputy, action, purpose, policy decision, authority source, and evidence so audit can separate cause from execution.

action_logic: Review near misses and abuse cases to tighten scopes, remove unnecessary deputy privileges, or redesign interfaces around explicit capabilities.

decision_rules: A deputy may not use its own broader authority when the requested action is outside the originator’s allowed scope.

decision_rules: Transport authentication, session presence, or internal-service trust is insufficient unless it is bound to request-specific intent and authority.

decision_rules: A request that drops caller, tenant, or purpose context must fail closed or be re-authorized before privileged execution.

decision_rules: Delegation tokens, capabilities, approvals, or attestations must be scoped to resource, action, principal, time, and purpose when the risk warrants it.

decision_rules: High-risk or ambiguity-heavy actions require step-up confirmation, secondary authorization, or human review rather than silent deputy execution.

decision_rules: Audit records must preserve both causing principal and executing deputy; collapsing them into one actor is a control failure.

target_invariants: Originator identity or relevant principal context remains attached to the request through deputy execution.

target_invariants: Intent or purpose scope remains distinguishable from mere possession of a credential or channel.

target_invariants: Deputy execution authority is bounded by the originator’s authorized scope for that action.

target_invariants: Delegation evidence is fresh enough for the use context and revocable when appropriate.

target_invariants: Missing, ambiguous, or contradictory authority binding fails closed or moves to explicit review.

target_invariants: Audit can reconstruct who caused the action, who executed it, under what authority, and under which policy decision.

expected_outcomes: Reduced borrowed-authority attacks and accidental authority laundering.

expected_outcomes: Clear separation between authentication, authorization, delegation, execution, and accountability.

expected_outcomes: Lower blast radius from broad service accounts, proxies, or administrative intermediaries.

expected_outcomes: Better tenant, user, subject, and purpose isolation in mediated systems.

expected_outcomes: More reliable forensic and accountability records for sensitive actions.

expected_outcomes: Safer automation because agents act with scoped authority rather than ambient privilege.

prose_essence:
Principal-Bound Authority Mediation solves the case where a legitimate intermediary has power, but a request reaching that intermediary may have been caused by someone who lacks that power. The key move is to stop asking only whether the deputy can act. The system must ask who caused this request, what they meant to authorize, what they are allowed to authorize, and whether the deputy is allowed to spend its own execution authority for that scoped purpose.

This is why the pattern is distinct from ordinary access control or authentication. Authentication may prove that a browser session, user, service, token, document, or caller is real. Access control may prove that the deputy can reach the resource. The confused-deputy failure occurs in the space between those checks: the deputy executes with its own authority even though the originator’s authority and intent were never bound to the action.

CSRF Intent-Authority Binding

short_definition: Web-security variant that refuses to treat ambient browser credentials as proof that the user intended the request.

distinctive_feature: The deputy is a web service receiving credentialed requests whose origin or user intent may be attacker-controlled.

distinct_from_parent: The parent covers any privileged intermediary; this variant centers on browser/session ambient authority and request-forgery defenses.

still_same_parent_because: It still solves the same borrowed-authority problem by coupling origin, intent, scope, and deputy action before execution.

use_when: A browser, client, session, or user agent automatically carries credentials to a privileged service.

use_when: An attacker can cause a request to be sent without directly possessing the credential.

use_when: The server must distinguish authenticated transport from user-intended authorization for this action.

example: A funds-transfer endpoint requires a per-form token or explicit confirmation instead of accepting only ambient cookies.

example: A privileged admin API rejects a cross-origin form post that lacks a request-bound intent proof.

Service-Account Deputy Scoping

short_definition: Service-to-service variant that prevents a privileged service account from performing actions for a caller outside the caller’s permitted scope.

distinctive_feature: The deputy is an automated service or agent whose standing credentials may exceed the requester’s authority.

distinct_from_parent: The parent is cross-domain; this variant emphasizes service accounts, machine identity, tenant boundaries, and on-behalf-of authorization.

still_same_parent_because: The same structural rule applies: execution authority may be used only when coupled to an authorized originator and scope.

use_when: Automated services, agents, workers, or bots act through accounts more privileged than the requesting user or tenant.

use_when: The service needs some standing authority to operate, but individual requests should be bounded by the caller’s authority.

use_when: Audit or policy must preserve who caused the action, not only which service account executed it.

example: A build service can deploy only resources permitted by the user, project, and workload identity carried in the request.

example: A reporting job reads records as the requester rather than as an unrestricted background administrator.

Object-Capability Authority Mediation

short_definition: Capability-oriented variant in which possession of an unforgeable, narrowly scoped reference replaces ambient authority at the deputy boundary.

distinctive_feature: The authority unit is a capability/reference carried with the request instead of a broad role or ambient credential.

distinct_from_parent: The parent is the general mediation pattern; this variant chooses capability discipline as the main implementation family.

still_same_parent_because: Capabilities are one way to enforce the same originator-scope-to-deputy-action coupling.

use_when: A system can redesign authority as explicit unforgeable capabilities rather than global permissions.

use_when: The deputy should never infer authorization from caller identity alone.

use_when: Safe execution depends on passing only the authority needed for the specific requested object or action.

example: A service opens only the file descriptor explicitly delegated by the requester rather than any file the service account can reach.

near_names:
Confused Deputy Problem
Confused Deputy Guarding
Requester-Bound Authorization
Originator-Scoped Authority Mediation
Principal-Bound Authorization
CSRF
Cross-Site Request Forgery


Priority-Based Admission

related_primes: flow constraint resource_management trade_offs queueing scheduling threshold procedural_fairness equity legitimacy transparency accountability observability

essence_one_line: Admit candidates at a boundary by an explicit priority policy so scarce capacity is reserved for higher-priority flows.

prose_failure_modes:
Common failure modes include:

- **Priority misclassification** — Candidates receive the wrong priority.
- **Gaming priority labels** — Actors exaggerate urgency, severity, or entitlement to gain admission.
- **Opaque gatekeeping** — Admission decisions cannot be explained or reviewed.
- **Bias amplification** — The priority rule reproduces or worsens existing inequalities.
- **Priority inversion** — Lower-priority candidates are admitted ahead of higher-priority ones.
- **Starvation of low-priority cases** — Some candidates never receive service.
- **Administrative bottleneck** — Assessment consumes so much capacity that admission slows.
- **Legitimacy loss** — Affected parties reject the policy as unfair or arbitrary.
- **Emergency exception sprawl** — Too many exceptions undermine the rule.
- **Silent denial** — Nonadmitted candidates are effectively rejected without acknowledgement.
- **Brittle priority rules** — The criteria fail under novel cases.
- **Queue-jumping pathology** — Priority channels become tools for privileged bypass.
- **Overfitting priority policy to past cases** — The rule matches old patterns but fails in new conditions.

These failure modes should be treated as part of the archetype's design space.

prose_tradeoffs:
Priority-Based Admission accepts unequal timing or access in order to allocate scarce capacity more purposefully.

Typical tradeoffs include:

- **Lower-priority candidates are delayed or excluded** even when they may have legitimate need.
- **Fairness disputes arise** because priority criteria are contestable.
- **Classification errors can harm candidates** by assigning them the wrong priority.
- **Administrative overhead increases** because candidates must be assessed.
- **Gaming or misrepresentation may increase** as actors try to appear high-priority.
- **Simplicity declines** compared with first-come-first-served.
- **Legitimacy risk increases** if affected parties do not trust the criteria.
- **Existing bias may be entrenched** if priority attributes reflect unequal systems.
- **Neutrality of arrival order is sacrificed** in favor of explicit priority.

The archetype is therefore not merely efficiency improvement. It is an allocation decision under scarcity.

prose_invariants_to_preserve:
Priority-Based Admission should preserve explicit invariants:

- **Priority criteria are explicit** — The system should know what counts and why.
- **Admission decisions are auditable** — Decisions should be explainable enough to review.
- **Critical cases are not blocked by lower-priority cases** — The intervention should actually preserve capacity for what matters most.
- **Nonadmitted candidates receive defined handling** — Rejection, deferral, waiting, rerouting, or appeal should be explicit.
- **Classification errors can be corrected** — Mistakes should not become irreversible harm where correction is possible.
- **Policy does not create unacceptable discrimination or harm** — Priority should not encode unjust exclusion.
- **Reserved capacity is not silently consumed** — Protected capacity should remain available for the intended class.
- **The policy remains aligned with the system goal** — Priority rules should not drift into self-serving gatekeeping.

If these invariants cannot be preserved, the intervention may become arbitrary, biased, or illegitimate.

Triaged Admission

short_definition: Admit or serve requests according to urgency, need, risk, or priority classification.

distinctive_feature: The distinctive feature is triage-like classification before admission.

distinct_from_parent: Priority-based admission is broader; triaged admission emphasizes urgency/need classification.

still_same_parent_because: It remains priority-based admission because admission is ranked by classification.

use_when: Not all requests can be admitted immediately.

use_when: Priority differences are ethically or operationally meaningful.

example_domains:
healthcare
public services
support queues
education

failure_modes:
Priority categories encode bias.
Appeal/review path is absent.


name: Private Information Asymmetry Governance

batch: Batch 07

aliases:
Information Asymmetry Governance
Private Information Alignment
Asymmetric Information Governance
Hidden Information Governance
Private Knowledge Asymmetry Control
Information Imbalance Remediation
Asymmetric Knowledge Transaction Design
Private Information Risk Control
Hidden-State Interaction Governance
Unequal Information Coordination

slug: asymmetry

slug: screening

slug: transparency

slug: trust

slug: contract

slug: uncertainty

slug: risk

slug: equity

slug: monitoring

slug: coordination

slug: role

slug: institution

essence_one_line: When parties know different private facts that materially affect a decision or transaction, map the knowledge gap, classify the hidden-information type, and install a proportionate mix of disclosure, verification, screening, signaling, monitoring, and incentive design.

compression_statement: Private Information Asymmetry Governance treats unequal knowledge as a structural condition of interaction rather than as a mere communication defect. The pattern identifies which actor knows which fact, who bears the consequence of not knowing it, whether the fact concerns hidden type, hidden action, hidden state, hidden intent, hidden quality, or hidden outside option, and which remedy changes the interaction without overexposing sensitive information. It then chooses between direct disclosure, trusted verification, screening, costly signaling, monitoring, risk sharing, warranties, role separation, reputation, or safe ignorance, and maintains residual-asymmetry records so controls can be recalibrated.

core_intuition: Not every knowledge gap should be eliminated. Some private knowledge is legitimate, sensitive, or socially valuable; other private knowledge lets one side misprice risk, exploit the other side, shift losses, or degrade trust. The useful move is to make the asymmetry explicit, connect it to a decision consequence, and choose the lightest credible intervention that lets the affected party or system act as if the material private fact had been made decision-relevant.

canonical_formula: information_asymmetry_governance = knowledge_gap(actor_a_private_facts, actor_b_decision_exposure) + asymmetry_type_classifier + remedy_portfolio(disclose | verify | screen | signal | monitor | contract | preserve_privacy) + residual_asymmetry_monitor

structural_problem: A transaction, delegation, allocation, safety decision, or cooperative interaction depends on facts that are privately known by one party and not available to another party who must rely on the decision. If the gap is ignored, the system may invite adverse selection, moral hazard, strategic misrepresentation, principal-agent drift, biased allocation, or unearned trust. If the gap is overcorrected, the system may violate privacy, exclude legitimate participants, create costly bureaucracy, or teach participants to game the revelation mechanism.

condition: One party knows a materially relevant fact about quality, risk, cost, intent, capacity, identity, need, or future action that another party cannot directly observe.

notes: The fact changes pricing, allocation, trust, safety, or accountability.

condition: The party with private information has incentives to hide, exaggerate, selectively reveal, or delay the fact.

notes: Strategic behavior is plausible even if not yet observed.

condition: A pool, market, queue, contract, delegation, or platform starts attracting hidden high-risk or low-quality participants.

notes: This is the adverse-selection route through the parent pattern.

condition: A protected or delegated actor can take hidden actions after receiving protection, authority, or access.

notes: This is the moral-hazard / agency route through the parent pattern.

condition: Receivers cannot distinguish high-quality from low-quality claims, credentials, products, or commitments.

notes: Screening and signaling become candidate mechanisms.

condition: Disclosure would be useful but creates privacy, security, legitimacy, or fairness concerns.

notes: Verification, attestation, escrow, selective disclosure, or privacy-preserving proof may be better than full revelation.

condition: Existing remedies address only a subcase and no one owns the cross-case information map.

notes: The parent governance layer is missing.

condition: Participants disagree about whether the problem is ignorance, deception, market failure, conflict of interest, or legitimate confidentiality.

notes: Classification is needed before remedy selection.

symptoms: Decisions repeatedly fail because an important fact was known somewhere but not available at the decision point.

symptoms: Low-quality, high-risk, or opportunistic participants enter a pool because they know more about their type than the gatekeeper does.

symptoms: Actors take riskier actions after obtaining insurance, authority, funding, or protection from downside.

symptoms: Participants demand broad disclosure, while others argue that the requested facts are private or security-sensitive.

symptoms: A credential, certificate, review, or reputation score is used even though no one can state what hidden fact it credibly reveals.

symptoms: Policies require information collection without explaining how collected information changes routing, pricing, access, or accountability.

symptoms: Receivers either overtrust unverified claims or distrust all claims because they cannot distinguish reliable signals from cheap talk.

symptoms: Hidden-information remedies drift into surveillance, exclusion, or performative paperwork.

symptoms: Different teams treat adverse selection, moral hazard, screening, signaling, conflicts of interest, and delegation as unrelated problems.

symptoms: A transaction appears voluntary and fair locally, but one side systematically holds private knowledge that changes the bargain.

root_tension: The side that knows a material fact often has weaker incentive to reveal it than the side exposed to the consequence has to know it. Closing the gap improves trust and allocation quality, but full transparency can be costly, invasive, unsafe, or strategically gameable. The intervention must make the consequential knowledge relation governable without assuming that all information should be public.

anti_signatures: The relevant information is public, equally observable, and equally interpretable; the issue is disagreement or value conflict rather than private knowledge.

anti_signatures: The problem is mainly measurement error or noise, not unequal access to a material fact.

anti_signatures: The desired solution is ordinary education or documentation because no strategic or consequential private-information gap exists.

anti_signatures: A fully specified child pattern already applies with no remaining cross-case governance need, such as a pure hidden-type screen or a pure moral-hazard mitigation design.

anti_signatures: The information gap is deliberately protected by law, ethics, safety, or dignity and the decision can be redesigned not to require the private fact.

structural_intervention: Construct an information-asymmetry map linking private facts, knowledge holders, affected decisions, exposed parties, incentives, and legitimate secrecy boundaries; classify the asymmetry type; choose a proportionate control portfolio; then monitor whether residual asymmetry remains within an agreed decision-risk envelope.

step: Map the interaction and decision exposure.

logic: Name the parties, the transaction or delegation, the decision that depends on hidden information, and the party who bears the error or loss if the fact is missing.

step: Inventory private facts and observability gaps.

logic: Separate hidden type, hidden action, hidden state, hidden intent, hidden quality, hidden outside option, and hidden conflict of interest.

step: Assess incentives and gaming pressure.

logic: Ask who benefits from concealment, exaggeration, selective revelation, delay, or mimicry.

step: Define legitimate secrecy and minimization boundaries.

logic: Mark facts that should not be broadly revealed and decide whether role-scoped disclosure, attestation, escrow, or zero-knowledge-style verification is sufficient.

step: Select the remedy family before selecting tools.

logic: Choose disclosure, verification, screening, signaling, monitoring, contract design, risk-sharing, reputation, role separation, or deliberate safe ignorance based on asymmetry type and stakes.

step: Bind the information remedy to a decision rule.

logic: Collected or verified information must change eligibility, price, routing, warranty, accountability, escalation, or confidence; otherwise it becomes noise or surveillance.

step: Provide challenge, appeal, and correction paths.

logic: Because screens and signals create false positives, false negatives, and status injuries, affected parties need review and update rights.

step: Monitor residual asymmetry and adaptive gaming.

logic: Participants learn the remedy; update screens, signals, contracts, and disclosures as base rates, incentives, and strategic behavior shift.

rule: Use direct disclosure when the fact is material, safe to reveal, low-burden to communicate, and interpretable by the receiver.

rule: Use trusted verification or attestation when the receiver needs assurance but not raw sensitive information.

rule: Use screening when the receiver must classify hidden type before admission, pricing, routing, or allocation.

rule: Use signaling when informed parties can credibly reveal type, commitment, or quality through costly, verifiable, or liability-backed behavior.

rule: Use monitoring and accountability when the main risk is hidden action after contract, delegation, insurance, funding, or access.

rule: Use risk-sharing, warranties, deposits, or clawbacks when behavior or quality cannot be fully observed but consequences can be assigned.

rule: Use role separation or independent review when the asymmetry is entangled with conflict of interest or discretion.

rule: Preserve ignorance by design when the private fact should not be known and the decision can be made fairly without it.

target_invariants: Material private facts are connected to concrete decision consequences rather than collected generically.

target_invariants: Legitimate privacy, confidentiality, and security boundaries are not erased by the desire for perfect information.

target_invariants: The remedy is proportionate to stakes, gaming pressure, error cost, and affected-party vulnerability.

target_invariants: Signals and screens retain credibility under mimicry and adaptation.

target_invariants: Residual asymmetry is explicit, owned, and periodically reviewed.

target_invariants: Decision rules remain auditable, contestable, and recalibrated as base rates change.

target_invariants: The pattern does not collapse every hidden-information problem into surveillance or blanket disclosure.

expected_outcomes: Better matching between participants, roles, risks, prices, resources, and responsibilities.

expected_outcomes: Reduced adverse selection, moral hazard, and principal-agent drift without requiring impossible perfect monitoring.

expected_outcomes: Clearer separation between legitimate secrecy and strategically harmful concealment.

expected_outcomes: More credible signals, screens, and attestations with lower mimicry and gaming rates.

expected_outcomes: Improved trust because receivers know which private facts are controlled, verified, irrelevant, or intentionally protected.

expected_outcomes: Lower hidden-risk accumulation in pools, platforms, contracts, and delegated authority structures.

Hidden-Type Information Asymmetry

short_definition: One party privately knows a durable quality, risk, capacity, or identity-relevant type before admission or transaction.

distinctive_feature: The hidden fact concerns who or what the participant is before the interaction.

distinct_from_parent: It is the type-classification branch of the broader information asymmetry pattern.

still_same_parent_because: It still requires private-fact mapping, legitimate secrecy review, remedy selection, and residual-asymmetry monitoring.

use_when: Pool entry, eligibility, hiring, underwriting, or matching depends on latent attributes.

use_when: The main remedy candidates are screening, attestation, self-selection, or segmentation.

example_domains: insurance hiring marketplaces

domain: insurance

example: Applicants know more about their health risk than the insurer; underwriting screens and risk-sharing govern entry.

failure_modes: Screening becomes discriminatory proxy use or is gamed by applicants.

Hidden-Action Information Asymmetry

short_definition: One party can take consequential actions after protection, delegation, funding, access, or contract formation that other parties cannot fully observe.

distinctive_feature: The hidden fact concerns conduct over time rather than entry type.

distinct_from_parent: It routes strongly toward moral hazard, monitoring, accountability, and risk-sharing mechanisms.

still_same_parent_because: The parent map still defines who knows what and how much observability is proportionate.

use_when: Behavior after the agreement matters more than pre-agreement type.

use_when: Monitoring is incomplete and downside can be shifted.

example_domains: delegation insurance contracting

domain: delegation

example: A contractor controls effort quality that the principal sees only through delayed outcomes.

failure_modes: Monitoring drives performative compliance or violates legitimate autonomy.

short_definition: The system needs assurance about a private fact without broad exposure of the raw information.

distinctive_feature: The remedy is not more transparency but controlled proof or role-scoped revelation.

distinct_from_parent: It emphasizes confidentiality-preserving verification inside the broader remedy portfolio.

still_same_parent_because: It still governs the same private-fact/decision-exposure relation.

use_when: The private fact is sensitive, security-relevant, dignity-relevant, or legally constrained.

use_when: Attestation or escrow can substitute for full disclosure.

example_domains: healthcare compliance cybersecurity

domain: compliance

example: A supplier proves certification status through an auditor without exposing proprietary process details.

failure_modes: The verifier becomes a new trusted-intermediary compromise point.

name: Strategic Signal Interpretation Asymmetry

short_definition: Receivers infer hidden quality, intent, or commitment from signals whose credibility depends on cost, verification, or consequence coupling.

distinctive_feature: The hidden information is mediated through a signal channel whose value can decay.

distinct_from_parent: It focuses on signal credibility and interpretation rather than the whole private-information remedy portfolio.

still_same_parent_because: Signal design remains one branch of information-asymmetry governance.

source_primes: information_asymmetry signaling trust

use_when: Direct observation is unavailable but signal-bearing behavior is available.

use_when: Cheap talk, mimicry, or signal inflation is a significant risk.

example: A credential functions as a signal only if it remains meaningfully costly and correlated with capability.

failure_modes: Signals inflate, become easy to fake, or exclude qualified parties who lack access to the signaling channel.

near_names:
Information Asymmetry Governance
Asymmetric Information Governance
Hidden Information Structure Governance
Private Information Alignment
Knowledge Imbalance Control