We analyze the role of relative performance evaluation when a principal has several agents, who face correlated shocks. If limited liability constraints are binding, relative performance evaluation may be of no value if the principal is restricted to symmetric contracts. However, with asymmetric...

We analyse the dynamics of public and private sector employment in Bangladesh, using the natural experiment provided by the partial privatization of the jute industry. The public sector had substantial excess employment of workers initially, but this excess was substantially eroded by the end of...

We study the role of communication in a high stakes prisoner's dilemma, using data from a television game show. 40 Percent of the players voluntarily promise to cooperate, and these players are 50 percentage points more likely to cooperate than players who do not volunteer a promise. However,...