Working Time and Wage Rate Differences: A Contract Theory Approach

game theory approach on detrmining exchange and wage rate: empirical study in iran

in iran’s system of tripartite collective bargaining, does the wage-policy maker consistently react optimally to the best move made by the exchange rate-policy maker (nash-rule) or only to the state of economy (non-nash rule)?. this paper not only investigates the nature of the political game (nash rule against non-nash rule) but also estimates some structural parameters by using 2sls method an...

A Contract Theory Approach to Business Bankruptcy

Complementarity and Custom in Wage Contract Violation*

We analyze a model of wage payment practices in which strategic complementarities arise because each employer’s costs of delaying wages decrease with the arrears in its labor market. The model is estimated on panel data for workers and firms in Russia, facilitating identification through fixed effects for employees, employers, and local labor markets, and instrumental variables based on policy ...

Contract theory in continuous - time models

This book provides a rigorous mathematical treatment of the principal-agent problem in its three main forms: • Risk sharing under full information. In this case, the principal and the agent share the same information. This case is also known as the individual rationality constraint . • Contracting under hidden action. In this case, the principal has less information than the agent. This case is...

Profit-Sharing as the Optimal Wage Contract

This paper analyses the optimal wage contract when firms face demand uncertainty and workers care about employment stability. Workers choose the firm that offers the highest utility taking into account the future lay-off probabilities; firms choose the wage contract that maximises the residual share of the gains from production. For risk-neutral workers this occurs with any efficient wage contr...