repeated moral hazard. In the optimal contract, the agent may be paid to quit after a poor performance. We show that a generous … severance policy facilitates the adoption of team incentives and team-based production by making it cost-effective to implement …

This agent-based model contributes to a theory of corporate culture in which company performance and employees …’ behaviour result from the interaction between financial incentives, motivational factors and endogenous social norms. Employees … simulations show that financial incentives can (i) lead to inefficient levels of cooperation, and (ii) reinforce value …