This study explores the effect of employee organizational identity on developing effective compensation contracts to improve organizational performance. We adopt the economic identity theory to mathematically model and test this model using data from a Japanese listed firm that uses an...

This study adopts behavioral contract theory through a mathematical model and clarifies the situation in which a fixed–salary contract is preferable to incentives–based one for the principal. Theoretically, the expected utility for the principal is higher under an incentives–based contract...

Agency theory is a powerful tool but it is not all-encompassing due to the fact that it focuses mainly on pecuniary motivation. In this paper, therefore, by simply extending existing models that rely on agency theory, and by incorporating complex human factors into them, we examine the role of...