This study investigates if and how the influence of compensation interdependence on risk-taking depends on mutual monitoring of risky investment decisions. We argue that individuals under compensation interdependence have a behavioral incentive for higher risk-taking if mutual monitoring is...

In a principal - multi-agent relationship, we derive the optimal mutual monitoring - incentive pay mix. When agents are better informed about their effort choices than the principal, and when their information is suffciently "good" there is a substituability between those two modes of providing...

This paper argues that, in general, profit sharing aligns the interests of workers and the firm and that this alignment reduces the extent of conflict between workers and management. This paper also argues that this general result will not carry over to the workers least able to respond to the...

Standard game theoretic models predict, based on subgame perfection, that public goods will not be provided even if agents are allowed to monitor free riders at some cost. Further, because punishment is not credible in these environments, this prediction is invariant to the size of groups....

Recent public goods experiments have shown that free riding can be curtailed through mutual monitoring and sanctioning between members of a group. However, often we can not allow for punishment and exclude the possibility of counter-punishment occurring. We design a public goods experiment,...