We study the problem of deterring undesirable behavior in a moral hazard framework with risk averse individuals, noisy information and costly sanctions. We find that, if sanctions are a pure loss, a utilitarian society should use a bang-bang penalty scheme satisfying the maximum penalty...

Cet article analyse les propriétés de complémentarité et de substituabilité entre systèmes de surveillance et mécanismes incitatifs dans une relation principal-agent, lorsque les parties sont neutres à l'égard du risque et que l'agent fait face à une contrainte de solvabilité. À...

We consider the effects on reward systems of workers' concern with relative pay by comparing the wage costs of providing incentives through group versus individual bonus schemes. When workers have a propensity for envy, either scheme may be the least cost one depending on the workers' outside...

We consider the cost of providing incentives through tournaments when workers are inequity averse and performance evaluation is costly. The principal never benefits from empathy between the workers, by he may benefit from their propensity for envy depending on the costs of assessing performance....

We argue that the common law standard of proof, given the rules of evidence, does not minimize expected error as usually argued in the legal literature, but may well be efficient from the standpoint of providing maximal incentives for socially desirable behavior. By contrast, civil law's higher...

We analyze a two-task work environment with risk-neutral but inequality averse individuals. For the agent employed in task 2 effort is verifiable, while in task 1 it is not. Accordingly, agent 1 receives an incentive contract which, due to his wealth constraint, leads to a rent that the other...

We analyze the design of legal principles and procedures for court decision-making in civil litigation. The objective is the provision of appropriate incentives for potential tort-feasors to exert care, when evidence about care is imperfect and may be distorted by the parties. Efficiency is...

We debate the contribution of the economic analysis of legal procedures, with a special regard for the debate between inquisitorial and accusatory systems and the judge?s role in the course of the procedure. The article proposes a presentation of the literature and develops specific models...

This paper analyzes the cost and incentive properties of the standard of proof for a finding of negligence. In common law, the usual standard is for courts to decide on the basis of a so-called balance of probabilities or preponderance of the evidence. We show that, if producing information...

Cet article analyse l'utilisation efficace de l'information dans un problème de principal agent avec risque moral et neutralité au risque. On montre que, pour un système arbitraire d'information, toute l'information pertinente d'un point de vue incitatif peut être résumée par une...