Moral Hazard Contracts: Does One Size Fit All?

Incentive theory predicts that contract terms should respond to differences in agents’ productivities. Firms’ practice of anonymous contracts thus appears puzzling. We show that such a "one-size-fits-all" approach can be reconciled with standard agency theory if careers are marked by frequent transitions between employers, and agents have career concerns because complete long-term contracts are not feasible.

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Year of publication:	2006-11
Authors:	Koch, Alexander K. ; Peyrache, Eloïc
Institutions:	Institute for the Study of Labor (IZA)
Subject:	anonymous contracts \| career concerns \| incentive contracts \| reputation

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Extent:	application/pdf
Series:	IZA Discussion Papers.
Type of publication:	Book / Working Paper
Notes:	Number 2463 9 pages
Classification:	D80 - Information and Uncertainty. General ; J33 - Compensation Packages; Payment Methods ; L14 - Transactional Relationships; Contracts and Reputation; Networks ; M12 - Personnel Management
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005703757