Recent laboratory evidence suggests that social preferences may affect contractual outcomes under moral hazard. In accordance with previous research, this paper uses written personality tests for job candidates as a proxy for whether firms care about personality traits of employees, in...

Empirically, compensation systems generate substantial effort despite weak monetary incentives. We consider reciprocal motivations as a source of incentives. We solve for the optimal contract in the basic principal-agent problem and show that reciprocal motivations and explicit performance-based...

An important aspect in determining the effectiveness of gift exchange relations in labor markets is the ability of the worker to “repay the gift” to the employer. To test this hypothesis, we conduct a real effort laboratory experiment where we vary the wage and the effect of the worker’s...

We conduct a field experiment where we vary both the presence of a gift exchange wage and the effect of the worker’s effort on the manager’s payoff. The results indicate a strong complementarity between the initial wage gift and the agent’s ability to “repay the gift”. We collect...

We consider a consumption model that takes into account the valuation and demand uncertainties that consumers face while using access services. Typical examples of such services include telecommunication services, extended warranties for consumer electronics, and club memberships. We demonstrate...

A large and growing literature has demonstrated that explicit incentives, such as enforceable contracts, can lead agents to withhold effort. We investigate when this behavioral result arises. In an extensive laboratory experiment, we find that imposing control through an enforceable contract is...

What explains the varying responses by Thai governments to changes in the international economic environment over time. To answer this the paper emphasizes the link between the nature of the political structure/policymaking environment and the government’s reform capacity. Thailand’s...

In this article, we seek to rectify the absence of political analysis characterizing most literature on innovation and development. Although existing research is careful to note the lack of any single recipe or model of innovation, most scholars identify a range of institutions and policies...

Scandinavian countries are often portrayed in policy debates as model examples having shown how to square concerns for efficiency and equity. The core principle of the Scandinavian welfare model is an individual entitlement to public sector provisions combined with collective financing via...