A fundamental result of the principal-agent literature is that pay will be linked to performance when it is difficult for the principal to monitor the agent’s actions. However, performance pay can lead to adverse incentives. In these models, high-powered incentives encourage workers to neglect...

Prior research shows that grocery stores reduce prices to compete with Walmart Supercenters. This study finds evidence that the competitive effects of two other big-box retailers—Costco and Walmart-owned Sam's Club—are quite different. Using city-level panel grocery price data matched with a...