منابع مشابه
Relational Incentive Contracts
Standard incentive theory models provide a rich framework for studying informational problems but assume that contracts can be perfectly enforced. This paper studies the design of self-enforced relational contracts. I show that optimal contracts often can take a simple stationary form, but that self-enforcement restricts promised compensation and affects incentive provision. With hidden informa...
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This paper extends Levin’s (2003) relational contract model by having not only the agent’s cost of effort (agent’s type), but also the value of that effort to the principal (principal’s type) subject to i.i.d. shocks. When optimal effort is fully pooled across agent types for multiple principal types, it is also pooled across those principal types. When optimal effort separates some agent types...
متن کاملEfficient Incentive Contracts
A so-called "incentive contract" is a linear payment schedule, where the buyer pays a fixed fee plus some proportion of audited project cost. That remaining proportion of project cost borne by the seller is called the "sharing ratio." A higher sharing ratio creates more incentive to reduce costs. But it also makes the agent bear more cost uncertainty, requiring as compensation a greater fixed f...
متن کاملRobust Incentive Contracts
We look at a principal–agent model in which the agent has to perform an action, the difficulty of which is better known ex interim than ex ante. We compare two contracting regimes; one with commitment to an ex ante negotiated contract, and one with an ex interim negotiated contract. The ex ante contract can not be too steep, but attempts to negotiate a steeper ex interim contract may result in ...
متن کاملIncentive contracts and unemployment
We study a labour market in which ...rms can observe workers’ output but not their e¤ort, and in which a worker’s productivity in a given ...rm depends on a worker-...rm speci...c component, unobservable for the ...rm. Firms o¤er wage contracts that optimally trade o¤ effort and wage costs. As a result, employed workers enjoy rents, which in turn create unemployment. We show that the incentive ...
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ژورنال
عنوان ژورنال: American Economic Review
سال: 2003
ISSN: 0002-8282
DOI: 10.1257/000282803322157115