In the design of procurement contracts, cost sharing, wherein the contractor receives a fixed fee plus a fraction of his cost, is common when the cost for completing the project is uncertain. We determine the best cost-sharing contract between a risk-neutral project manager and a risk-averse...

We study the interaction between a group of agents who exert costly effort over time to complete a project, and a manager who chooses the objectives that must be met in order for her to sign off on it. The manager has limited commitment power so that she can commit to the requirements only when...