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Optimal Incentive Contracts under Moral Hazard When the Agent is Free to Leave

Englmaier, Florian; Muehlheusser, Gerd; Roider, Andreas - C.E.P.R. Discussion Papers - 2010

We characterize optimal incentive contracts in a moral hazard framework extended in two directions. First, after effort provision, the agent is free to leave and pursue some ex-post outside option. Second, the value of this outside option is increasing in effort, and hence endogenous. Optimal...

Persistent link: https://www.econbiz.de/10008554231

Sabotage in Tournaments: Making the Beautiful Game a Bit Less Beautiful

Garicano, Luis; Palacios-Huerta, Ignacio - C.E.P.R. Discussion Papers - 2005

We exploit an incentive change in professional soccer leagues aimed at encouraging more attacking and goal scoring to obtain evidence on the effect of stronger incentives on productive and destructive effort. Using as control the behavior of the same teams in a competition that experienced no...

Persistent link: https://www.econbiz.de/10005114301

Credence Goods, Costly Diagnosis, and Subjective Evaluation

Bester, Helmut; Dahm, Matthias - C.E.P.R. Discussion Papers - 2014

objective outcome but only the consumer’s report, or subjective evaluation. A failure of the low-cost treatment delays the …

Persistent link: https://www.econbiz.de/10011084241

Contracting under Incomplete Information and Social Preferences: An Experimental Study

Hoppe, Eva I; Schmitz, Patrick W - C.E.P.R. Discussion Papers - 2013

Principal-agent models in which the agent has access to private information before a contract is signed are a … cornerstone of contract theory. We have conducted an experiment with 720 participants to explore whether the theoretical insights … the principals make contract offers, they anticipate that social preferences affect agents' behavior. …

Persistent link: https://www.econbiz.de/10011084433

Gathering Information before Signing a Contract: Experimental Evidence

Hoppe, Eva I; Schmitz, Patrick W - C.E.P.R. Discussion Papers - 2009

A central insight of agency theory is that when a principal offers a contract to a privately informed agent, the …

Persistent link: https://www.econbiz.de/10005789080

Why organizations fail: models and cases

Garicano, Luis; Rayo, Luis - C.E.P.R. Discussion Papers - 2015

-termism, both of which are instances of 'multitasking problems'; communication failures in the presence of both soft and hard …

Persistent link: https://www.econbiz.de/10011165668

Family Ties and Organizational Design: Evidence from Chinese Private Firms

Cai, Hongbin; Li, Hongbin; Park, Albert; Zhou, Li-An - C.E.P.R. Discussion Papers - 2010

Analyzing data from a unique survey of managers of Chinese private firms, we investigate how family ties with firm heads affect managerial compensation and job assignment. We find that family managers earn higher salaries and receive more bonuses, hold higher positions, and are given more...

Persistent link: https://www.econbiz.de/10008468597

The Quality of Entrepreneurs

Hvide, Hans K - C.E.P.R. Discussion Papers - 2005

What determines the quality of entrepreneurs? To address this question, the paper proposes a simple model of the interaction between individual workers’ decision to become entrepreneurs and established firms’ effort to keep their best workers and ideas. The main prediction from the model is...

Persistent link: https://www.econbiz.de/10005792326

Contractual Execution, Strategic Incompleteness and Venture Capital

Dessí, Roberta - C.E.P.R. Discussion Papers - 2009

information generated by execution of the contract. The key effects at work are explored in the case of financial contracts for …

Persistent link: https://www.econbiz.de/10004976792

Venture Capital and Knowledge Transfer

Dessí, Roberta; Yin, Nina - C.E.P.R. Discussion Papers - 2015

This paper explores a new role for venture capitalists, as knowledge intermediaries. A venture capital investor can communicate valuable knowledge to an entrepreneur, facilitating innovation. The venture capitalist can also communicate the entrepreneur's innovative knowledge to other portfolio...

Persistent link: https://www.econbiz.de/10011168896