Local officials in China have strongly supported new non-state firms, yet other officials in transition countries have often strongly hindered them. We argue that a likely cause of these sharp differences in behavior is differences in the source of government revenue. Local revenue in China came...

If policy prescriptions for compensation systems are to be useful, then they must be based on the empirical analysis of incentive effects; i.e., the elasticity of worker effort with respect to changes in the compensation system. We measure the elasticity of worker effort with respect to changes...

Local officials in China have strongly supported new non-state firms, yet other officials in transition countries have often strongly hindered them. We argue that a likely cause of these sharp differences in behavior is differences in the source of government revenue. Local revenue in China came...

We estimate the gain in productivity that is realized by paying workers piece rates rather than fixed wages; i.e., theincentive effect. Our data come from the payroll records of a British Columbia tree-planting firm that paid its workers both piece rates and fixed wages. These data contain...

We introduce learning based on genetic algorithms in a principal-agent model of optimal contracting under moral hazard. Applications corresponding to this setting abound in finance (credit under moral hazard), public finance (optimal taxation, information-constrained insurance), development...

Organizational innovation is essential to economic development. But, the way successful societies have organized new ventures has been remarkably similar in both past and present. The commenda organizations of medieval Italy shared many characteristics with modern startups that are financed by...

We apply agency theory to the payroll records of a copper mine that paid a production bonus to teams of workers. As with most incentive pay used by firms, the bonus was simpler in form than the optimal contract that balances incentives, insurance, and free-riding. We explore whether transactions...

We apply agency theory to the payroll records of a copper mine that paid a production bonus to teams of workers. As with most incentive pay used by firms, the bonus was simpler in form than the optimal contract that balances incentives, insurance, and free-riding. We explore whether transactions...

This paper deals with war termination. We develop a formal model based on the logic of domestic political accountability. We assume that leaders seek to maximize the likelihood that they will stay in office and that their decisions regarding war termination are responsive to their winning...