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We derive determinants of tax avoidance by means of a multi-task principal-agent model. We extend prevailing models by integrating both corporate and individual income taxation as well as by including tax planning effort in the agent's action portfolio. Our model shows novel and apparently...
Persistent link: https://www.econbiz.de/10013051278
incentives under limited commitment. It circumvents ratchet effects and facilitates the revelation of persistent private …
Persistent link: https://www.econbiz.de/10013053709
Using an agency model of firm behavior, the paper analyzes whether the cost of investment should be tax exempt. The findings suggest that, when managers engage in wasteful capital expenditures, welfare may decline if the cost of investment is tax deductible, as commonly advocated. The extent to...
Persistent link: https://www.econbiz.de/10013060519
bargaining, leading to stronger effort incentives and higher output. However, it also reduces incentives for labor market …
Persistent link: https://www.econbiz.de/10013316365
We derive the optimal contract between a principal and a liquidity-constrained agent in a stochastically repeated environment. The contract comprises a court-enforceable explicit bonus rule and an implicit fixed salary promise that must be self-enforcing. Since the agent's rent increases with...
Persistent link: https://www.econbiz.de/10013159705
Real-effort experiments are frequently used when examining a response to incentives. For any particular real …-effort task to be well-suited for such an exercise, subjects' cost for exerting effort must, for the range of incentives … nonmonetary incentives. However, despite its increasing use, a simple between-subject examination of the slider task's response to …
Persistent link: https://www.econbiz.de/10013021431
selection probability induce the monetary incentives in a large-scale Internet treatment. Two laboratory treatments complement … incentives. Our results suggest that cost-effective BRIS consist of high nominal payoffs and a small selection probability …
Persistent link: https://www.econbiz.de/10012985450
rents can be used to provide incentives. Preferences for reciprocity still affect the structure of an employment … interaction. Therefore, reciprocity-based and repeated-game incentives are dynamic substitutes, but complements at any given point …
Persistent link: https://www.econbiz.de/10012947453
This paper studies the costs and benefits of delegating decisions to superiorly informed agents relative to the use of rigid, non discretionary contracts. Delegation grants some flexibility in the choice of the action by the agent, but also requires the use of an appropriate incentive contract...
Persistent link: https://www.econbiz.de/10013116425
altruistic. Absent worker heterogeneity, an altruistic principal signals his altruism by offering relatively weak incentives and … excessively strong incentives and a relatively high expected total compensation …
Persistent link: https://www.econbiz.de/10013121201