development. Tournament-based contracts can be very effective in eliciting high effort, often outperforming other compensation … contracts, but they can also have negative consequences for both managers and workers. The benefits and disadvantages of …

norm violators. We further illustrate the powerful impact of fairness concerns on cooperation, competition, incentives, and …

Tournaments, reward structures based on rank order, are compared with individual contracts in a model with one risk … absence of a common shock, using optimal independent contracts dominates using the optimal tournament. Conversely, if the … contracts. Finally, it is shown that for a sufficiently large number of agents, a principal who cannot observe the common shock …

Do contracts provide reference points that affect ex post behavior? We address this question in a canonical buyer … and economically important impact on renegotiation behavior that goes beyond the effect of contracts on bargaining …