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This paper analyses bargaining over an incentive compatible contract in a moral hazard framework. We introduce the Kalai-Smorodinsky bargaining solution and compare the outcome with the commonly applied Nash solution. Whether worker’s effort is higher in the Nash or the Kalai-Smorodinsky...
Persistent link: https://www.econbiz.de/10010877973
A manufacturer’s incentives to undertake non-contractible investments depend on the profit margin on her sales to the … retailer, and slotting allowances can facilitate such incentives by increasing unit wholesale prices. At first glance, it is …
Persistent link: https://www.econbiz.de/10005094262
We examine how a shift of bargaining power within households operating in a competitive market environment affects equilibrium allocation and welfare. If price effects are sufficiently small, then typically an individual benefits from an increase of bargaining power, necessarily to the detriment...
Persistent link: https://www.econbiz.de/10005766162
We analyze the economic consequences of strategic delegation of the right to decide between public or private provision of governmental service and/or the authority to negotiate and renegotiate with the chosen service provider. Our model encompass both bureaucratic delegation from a government...
Persistent link: https://www.econbiz.de/10005405773
There has been little empirical work evaluating the sensitivity of fertility to financial incentives at the household … representation of the French tax-benefit system. Our results suggest that financial incentives play a notable role in determining …
Persistent link: https://www.econbiz.de/10005406074
actors provide powerful incentives and become superior when there are some fair-minded players. The principals understand … enforcement power of explicit and implicit incentives. This contract preference is associated with the fact that explicit … incentives weaken the enforcement power of implicit bonus incentives significantly. Our results are largely consistent with …
Persistent link: https://www.econbiz.de/10005406078
economic literature on incentives, and discusses their relationship to monetary compensation. Awards are better suited than … complement, or even substitute for, monetary incentives. While we discuss awards in the context of academia, our conclusions …
Persistent link: https://www.econbiz.de/10005406082
provision of incentives. Relative price and income effects are shown to be identifiable and strong. A number of empirically …
Persistent link: https://www.econbiz.de/10005406118
and moral hazard. Forgetting a default typically makes incentives worse, ex-ante, because it reduces the punishment for … increases the incentive to exert effort to preserve this reputation. Our key result is that if (i) borrowers’ incentives are …
Persistent link: https://www.econbiz.de/10005406386
&D cooperation. This paper explores this idea by analysing on the one hand the incentives for EU, Japan and Russia to adopt this … strategy, and on the other hand the incentives for the US to join a coalition which cooperates both on climate change control … and R&D) will be examined from the view point of countries’ profitability and free-riding incentives. Finally, after …
Persistent link: https://www.econbiz.de/10005406394