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Insurance and information : firms as a commitment device

Bovenberg, Ary Lans; Teulings, Coen N. - 2001

We explore the role of firms in insuring non-verifiable output. As a device that allows workers to commit to thedelivery of their output, the firm arises endogenously as an alternative to the market if workers are sufficiently riskaverse and the firm can base its incentive payments on good...

Persistent link: https://www.econbiz.de/10011316894

Optimal incentives without expected utility

Gonzalez Jimenez, Victor H. - 2022

This paper investigates the optimal design of incentives when agents distort probabilities. We show that the type of probability distortion displayed by the agent and its degree determine whether an incentivecompatible contract can be implemented, the strength of the incentives included in the...

Persistent link: https://www.econbiz.de/10013460007

The (self-)funding of intangibles

Döttling, Robin; Ladika, Tomislav; Perotti, Enrico C. - 2016

response to reduced debt capacity. We model how firms' payout and cash holding policies are affected by this shift. Our insight … is that the creation of intangibles is largely achieved by human capital investment and requires lower upfront outlays … dilution. Our empirical evidence confirms that firms with higher intangible investment have lower upfront investment needs …

Persistent link: https://www.econbiz.de/10011556238

Inverse adverse selection : the market for gems

Dari Mattiacci, Giuseppe; Onderstal, Sander; Parisi, … - 2010

This paper studies markets plagued with asymmetric information on the quality of traded goods. In Akerlof's setting, sellers are better informed than buyers. In contrast, we examine cases where buyers are better informed than sellers. This creates an inverse adverse selection problem: The market...

Persistent link: https://www.econbiz.de/10011382752

On existence of private unemployment insurance with advance information on future job losses

Denderski, Piotr; Stoltenberg, Christian - 2021

We study the existence of a profitable unemployment insurance market in a dynamic economy with adverse selection rooting in information on future job losses. The new feature of the model is that the insurer and workers interact repeatedly. Repeated interactions make it possible to threaten...

Persistent link: https://www.econbiz.de/10012545133

Dynamic insurance and adverse selection

Janssen, Maarten C. W.; Karamychev, Vladimir A. - 2001

Persistent link: https://www.econbiz.de/10001624802

Reciprocity and incentive pay in the workplace

Dur, Robert A. J.; Non, Jan Adrianus; Roelfsema, Hein - 2008

We study optimal incentive contracts for workers who are reciprocal to management attention. When neither worker's effort nor manager's attention can be contracted, a double moral-hazard problem arises, implying that reciprocal workers should be given weak financial incentives. In a...

Persistent link: https://www.econbiz.de/10011377049

Social interaction, co-worker altruism, and incentives

Dur, Robert A. J.; Sol, Joeri - 2009

Social interaction with colleagues is an important job attribute for many workers. To attract and retain workers, managers therefore need to think about how to create and preserve high-quality co-worker relationships. This paper develops a principal-multi-agent model where agents do not only...

Persistent link: https://www.econbiz.de/10011377106

Gift-exchange, incentives, and heterogeneous workers

Non, Jan Adrianus - 2011

Using a formal principal-agent model, I investigate the relation between monetary gift-exchange and incentive pay, while allowing for worker heterogeneity. I assume that some agents care more for their principal when they are convinced that the principal cares for them. Principals can signal...

Persistent link: https://www.econbiz.de/10011379625

Peer evaluation : incentives and co-worker relations

Sol, Joeri - 2010

In many workplaces co-workers have the best information about each other's effort. Managers may attempt to exploit this information through peer evaluation. I study peer evaluation in a pure moral hazard model of production by two limitedly liable agents. Agents receive a signal about their...

Persistent link: https://www.econbiz.de/10011380732

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