Carrots and Sticks as Incentive Mechanisms for the Optimal Initiation of Insolvency Proceedings

Sticks and Carrots: Two Incentive Mechanisms Supporting Intra-Group Cooperation

In this note, we introduce two distinct incentive mechanisms that support dynamic intra-group cooperation in the context of prisoner’s dilemma payoffs. The first mechanism involves a reward structure—a carrot—that supports both triadic and tripartite group relations. The second mechanism involves a punishment structure—a stick—that supports tripartite group relations. We also discuss how these ...

Carrots or Sticks? Optimal Compensation for Firm Managers

We investigate the existence of and explicitly characterize compensation structures that eliminate agency conflicts between a leveraged firm (or its shareholders) and the manager due to managerial asset substitution within a continuous time framework. The manager may dynamically switch between two strategies with different risks and expected returns after debt is in place. We show that when the...

Sticks and Carrots in Procurement∗

We study differently framed incentives in dynamic laboratory buyerseller relationships with multi-tasking and endogenous matching. The experimental design tries to mitigate the role of social preferences and intrinsic motivation. Absent explicit incentives, effort is low in both tasks. Their introduction boosts efficiency substantially increasing effort in the contractible task, mildly crowding...

Editorials Carrots, sticks and tuberculosis

The spectrum of nitrofurantoin lung injury continues to widen. The case histories are presented of two patients who developed lung disease associated with the use of nitrofurantoin with histological features of bronchiolitis obliterans organising pneumonia (BOOP), a rare but recognised form of drug induced injury. The two middle aged women presented with respiratory symptoms after prolonged tre...

Carrots and sticks for quality health care.