This paper evaluates the relative performances of several well--known and widely--used incentive mechanisms under controlled experimental conditions. The scenario utilized is a delegated investment setting where effort and risk aversions contribute to moral hazard among fund managers. Analytical...

We develop a theoretical framework for comparing the style of work in public and private enterprises. We incorporate ‘socializing’, as an activity that yields utility for workers and affects a firm’s output, into a simple multitask model of work organization. In contrast with previous...

Contract theory predicts that workers are remunerated based on all available unbiased individual performance measures. In the real world, measures are often biased: tasks are too complex to include all measures, unforeseen contingencies occur for which contracts specify nothing, and the...

Most principal-agent relationships in firms are multidimensional. In the presence of multiple tasks and multiple performance signals, the contract between principal and agent not only has to motivate the agent, but also has to direct the agent to allocate effort among different tasks. The value...

The issue of corporate governance has been high on the agenda of the business community for several years but is likely to be a defining issue of the late 1990s. The paper examines its history and discusses its relevance for communications professionals.