We study how AI affects compensation and job design when performance depends on workers' non-contractible effort. In a principal–agent model with limited liability, AI reduces effort costs but disproportionately lowers the cost of achieving satisfactory performance. This raises the incentive...

We establish three facts about work from home (WFH) in the United States. First, employees WFH more often at younger firms – almost twice as often at firms founded after 2015 than at firms founded before 1990. Second, employees working under younger CEOs have higher levels of WFH. The average...

We study how AI affects compensation and job design when performance depends on workers' non-contractible effort. In a principal-agent model with limited liability, AI reduces effort costs but disproportionately lowers the cost of achieving satisfactory performance. This raises the incentive...