We examine the role of discretion in executive incentive contracts, and explore the trade-offs firms face in choosing among imperfect objective measures of individual performance, more-accurate but non-verifiable subjective measures, and overly broad objective measures of company-wide performance that includes the performance of all agents in the firm. We generate implications and test the mode...

A smart contract is a special form of computer program that runs on blockchain and provides new way to implement financial business transactions in conflict-free transparent environment. In systems such as Ethereum, contracts can handle autonomously transfer assets considerable value other parties. Hence, it particularly important ensure function intended since bugs or vulnerabilities may lead,...

Access to credit is a key prerequisite for the development of smallholder agriculture. However, rural markets are typically characterized by market failures and access limited. Resource-providing contracts an institutional tool overcome through provision production inputs in form in-kind credit. Previous research has shown that interlinkage contract helps farmers financial constraints, foster i...

This paper presents a methodology for deriving business process descriptions based on terms in business contract. The aim is to assist process modellers in structuring collaborative interactions between parties, including their internal processes, to ensure contract-compliant behaviour. The methodology requires a formal model of contracts to facilitate process derivations and to form a basis fo...

Current approaches for the discovery, specification, and provision of services ignore the relationship between the service contract and the conditions in which the service can guarantee its contract. Moreover, they do not use formal methods for specifying services, contracts, and compositions. Without a formal basis it is not possible to justify through formal verification the correctness condi...

Economic performance depends crucially on how parties adapt to changing circumstances. We therefore study how the organization of economic activity can facilitate such adaptation. We focus on settings where spot transactions would produce inefficient adaptation, so we ask whether alternative governance structures (allocations of control) facilitate relational contracts that improve on spot adap...

What explains cross-country differences in the cost of contract enforcement? Previous findings suggest that fewer legal complexities support lower contract enforcement costs. In addition, recent work finds that individuals may rely on informal, cultural means to enforce agreements. Building from these two main bodies of work, this paper seeks to understand the variation of the costs of enforcin...

Two types of contractual solutions have been proposed for resolving incentive conflicts in vertical relationships: formal and relational (i.e., enforceable or not by third parties). Much is known about the optimal structure of formal contracts, but relatively little is known about the structure of relational contracts. We study a core feature of the latter: the conditions leading to continuatio...

Real-world dispute resolution should be guided by laws, even if such disputes may be resolved by bodies other than the court of laws. Hence in order to build contract dispute resolution systems we need a tool capable of representing, reasoning and programming with contract laws. In this paper we present such a tool called MoDiSo (MOdular Argumentation for DIspute ReSOlution) which combines the ...