Showing 1 - 10 of 3,490
The "iteration argument" presented in Schlicht (1996) shows that the allocation of property rights may generate inefficiencies, contrary to what the "Coase Theorem", as commonly understood, asserts. The argument may be summarized by saying that markets (and bargaining) cease to function properly...
Persistent link: https://www.econbiz.de/10011579589
Why are bonus/promotion schemes so widely used in reality? Are they effective in alleviating incentive problems? For the standard agency model, this paper proposes an alternative solution to the classical solution in Holmström (1979). The advantages of our solution are that (1) it is a simple...
Persistent link: https://www.econbiz.de/10013155998
Starting from the Contribution from Ronald Coase, the modern theoretical literature tends to identify the firm with the hierarchic coordination of the workforce, opposed to the coordination of the production factors operated by the market. Other authors prefer to concentrate on the entrepreneur...
Persistent link: https://www.econbiz.de/10014186651
This entry discusses alternative theories of contract choice and design with special emphasis on (i) the interaction between contract design and contract enforcement and (ii) the explanatory power of alternative theories. After discussing the primary functions of contract, the entry reviews the...
Persistent link: https://www.econbiz.de/10014046405
This entry discusses alternative theories of contract choice and design with special emphasis on (i) the interaction between contract design and contract enforcement and (ii) the explanatory power of alternative theories. After discussing the primary functions of contract, the entry reviews the...
Persistent link: https://www.econbiz.de/10014046406
This paper provides an empirical assessment of long-term liquefied natural gas (LNG) supply contracts to determine optimal contract duration. We study the trade-off between contracting costs due to repeated bilateral bargaining and the risk of being bound in an inflexible agreement in uncertain...
Persistent link: https://www.econbiz.de/10014203361
This paper studies alternative contract damage measures in the presence of specific investments that generate a direct benefit to the investor's trading partner (referred to as "cooperative investments"). We find that, both with and without the possibility of ex post renegotiation, (i) the...
Persistent link: https://www.econbiz.de/10014223117
This paper resolves three empirical puzzles in outsourcing by formalizing the adaptation cost of long-term performance contracts. Side-trading with a new partner alongside a long-term contract (to exploit an adaptation-requiring investment) is usually less effective than switching to the new...
Persistent link: https://www.econbiz.de/10014225332
We apply algorithmic data reading and textual analysis to compare the features of contracts in regulated industries subject to public scrutiny (which we call "public contracts") with relational private contracts. We show that public contracts are lengthier, have more rule-based rigid clauses,...
Persistent link: https://www.econbiz.de/10014156005
It is well-known that a seller imposed non-discrimination clause can soften downstream price competition by constraining opportunistic pricing behavior on the part of an upstream monopolist seller. But what about about market settings in which there exists a pivotal buyer? We show that in the...
Persistent link: https://www.econbiz.de/10014075799