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Implicit contracts, incentive compatibility, and involuntary unemployment : thirty years on

MacLeod, William Bentley; Malcomson, James M. - 2023

with reflections on the future of relational contract theory and practice. …

Persistent link: https://www.econbiz.de/10013500553

Tournaments, individualized contracts and career concerns

Koch, Alexander K. (contributor); … - 2005

Young professionals typically do not enter into life-long employment relations with a single firm. Therefore, future employers can learn about individuals' abilities from the observable facts regarding earlier work relations. We show that these informational spill-overs have profound...

Persistent link: https://www.econbiz.de/10003275078

More than the money : payoff-irrelevant terms in relational contracts

Cromwell, Erich; Goerg, Sebastian J.; Ziółkowska, Monika - 2018

two economically equivalent contracts - a fixed-term renewable and an open-ended at-will contract. Each contract provides … partners with full flexibility regarding the length and termination of their interaction. When only one contract type is … contract type. However, when both contracts are available offering a fixed-term instead of an open-ended contract is perceived …

Persistent link: https://www.econbiz.de/10011893426

Can contracts signal social norms? : experimental evidence

Danilov, Anastasia; Sliwka, Dirk - 2013

consequences. A principal-agent experiment is studied in which prior to contract choice principals are informed about past actions … principals agents exert nearly 50% higher efforts under a fixed wage contract when an informed principal had chosen this contract …

Persistent link: https://www.econbiz.de/10009765609

Dynamic incentive contracts under parameter uncertainty

Prat, Julien; Jovanovic, Boyan - 2010

We analyze a long-term contracting problem involving common uncertainty about a parameter capturing the productivity of … analytically solve for the optimal contract when the agent has exponential utility. We find that the Pareto frontier shifts out as … accumulates. -- principal-agent model ; optimal contract ; learning ; private information ; reputation ; career …

Persistent link: https://www.econbiz.de/10009303458

Dynamic contracts and learning by doing

Prat, Julien - 2014

This paper studies the design of optimal contracts in dynamic environments where agents learn by doing. We derive a condition under which contracts are fully incentive compatible. A closed-form solution is obtained when agents have CARA utility. It shows that human capital accumulation...

Persistent link: https://www.econbiz.de/10010246654

Hidden action, identification, and organization design

Schnedler, Wendelin - 2010

Incentives often fail in inducing economic agents to engage in a desirable activity; implementability is restricted. What restricts implementability? When does re-organization help to overcome this restriction? This paper shows that any restriction of implementability is caused by an...

Persistent link: https://www.econbiz.de/10009303451

Hidden insurance in a moral hazard economy

Bertola, Giuseppe; Koeniger, Winfried - 2013

We consider an economy where individuals privately choose effort and trade competitively priced securities that pay off with effort-determined probability. We show that if insurance against a negative shock is sufficiently incomplete, then standard functional form restrictions ensure that...

Persistent link: https://www.econbiz.de/10010225898

Image versus information : changing societal norms and optimal privacy

Ali, S. Nageeb; Bénabou, Roland - 2016

We analyze the costs and benefits of using social image to foster virtuous behavior. A Principal seeks to motivate reputation-conscious agents to supply a public good. Each agent chooses how much to contribute based on his own mix of public-spiritedness, private signal about the value of the...

Persistent link: https://www.econbiz.de/10011476544

The virtue of being underestimated : a note on discriminatory contracts in hidden information models

Schnedler, Wendelin - 2001

the optimal contract. A priori more productive (hazard rate dominant) agents work less, enjoy lower rents, but generate a …

Persistent link: https://www.econbiz.de/10011403219