Interactions between players with private information and opposed interests are often prone to bad advice and inefficient outcomes, e.g. markets for financial or health care services. In a deception game we investigate experimentally which factors could improve advice quality. Besides advisor...

We conduct a field experiment where we vary both the presence of a gift exchange wage and the effect of the worker's effort on the manager's payoff. The results indicate a strong complementarity between the initial wage gift and the agent's ability to repay the gift. We collect information on...

This paper examines how delivery tariffs and private quality standards are determined in vertical relations that are subject to asymmetric information. We consider an infinitely repeated game where an upstream firm sells a product to a downstream firm. In each period, the firms negotiate a...

Motivated agents are characterized by increasing their effort if their work generates not only a monetary return for them but also a benefit for a mission they support. While their motivation may stem from working for their preferred (i.e., the `right') mission, it may also be the principal's...

Incentive schemes affect performance and priorities of agents but, in reality, they can be complicated even for simple tasks. We analyze the effects of the salience of incentives in a team production setting where the principal has an interest in quantity and quality of output. We use data from...

We study the interaction of organizational culture and personal prosocial orientation in team work where teams compete against each other. In a computerized lab experiment with minimal group design, we prime subjects to two alternative organizational cultures emphasizing either self-enhancement...

We report three repetitions of Falk and Kosfeld's (2006) C5 and C10 treatments whose results largely conflict with those of the original study. We mainly observe hidden costs of control of low magnitude which lead to low-trust principal-agent relationships. We also report an extension where...

We study, theoretically and empirically, the effects of incentives on the self-selection and coordination of motivated agents to produce a social good. Agents join teams where they allocate effort to either generate individual monetary rewards (selfish effort) or contribute to the production of...

We attempt to formulate and explain two types of self-fulfilling prophecy, called the Pygmalion effect (if a supervisor thinks her subordinates will succeed, they are more likely to succeed) and the Galatea effect (if a person thinks he will succeed, he is more likely to succeed). To this...

Sanctions are widely used to promote compliance in principal-agent-relationships. While there is ample evidence confirming the predicted positive incentive effect of sanctions, it has also been shown that imposing sanctions may in fact reduce compliance by crowding-out intrinsic motivation. We...