This paper deals with contractual design and vertical relationships within a franchise chain, in the field of the literature on share contracts. Within a double-sided moral hazard, the contract sharing the profit generated by the vertical decentralized structure results from the necessity to...

Multi-unit franchising (MUF) is a governance form inside franchising networks where the franchisor transfers to the franchisees the right to own and operate more than one outlet. While previous empirical literature has revealed various advantages of MUF as compared to single-unit franchising...

The relationship between risk and incentives in franchise contracting is still an unsolved issue in the literature. According to the standard principal-agent model, a trade-off emerges between the franchisee's protection against risk and incentive motivation. Contrary to this traditional view,...