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Mediated audits
Pollrich, Martin - 2015
offering a menu of contracts. The analysis provides a proper benchmark for studying auditing under limited commitment and sheds … new light on the usefulness of mediation in contracting and on the design of optimal mechanisms. …
Persistent link: https://www.econbiz.de/10011285322
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Optimal incentive contracts to avert firm relocation
Pollrich, Martin; Schmidt, Robert C. - 2014
A unilateral policy intervention by a country (such as the introduction of an emission price) can induce firms to relocate to other countries. We analyze a dynamic game where a regulator offers contracts to avert relocation of a firm in each of two periods. The firm can undertake a...
Persistent link: https://www.econbiz.de/10010408009
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Optimal incentive contracts under moral hazard when the agent is free to leave
Englmaier, Florian; Mühlheußer, Gerd; Roider, Andreas - 2010
We characterize optimal incentive contracts in a moral hazard framework extended in two directions. First, after effort provision, the agent is free to leave and pursue some ex-post outside option. Second, the value of this outside option is increasing in effort, and hence endogenous. Optimal...
Persistent link: https://www.econbiz.de/10008822065
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Credence goods, costly diagnosis, and subjective evaluation
Bester, Helmut; Dahm, Matthias - 2014
We study contracting between a consumer and an expert. The expert can invest in diagnosis to obtain a noisy signal about whether a low-cost service is sufficient or whether a high-cost treatment is required to solve the consumer's problem. This involves moral hazard because diagnosis effort and...
Persistent link: https://www.econbiz.de/10010436207
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Exit options in incomplete contracts with asymmetric information
Bester, Helmut; Krähmer, Daniel - 2008
This paper analyzes bilateral contracting in an environment with contractual incompleteness and asymmetric information. One party (the seller) makes an unverifiable quality choice and the other party (the buyer) has private information about its valuation. A simple exit option contract, which...
Persistent link: https://www.econbiz.de/10010343931
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Optimal contracts for lenient supervisors
Giebe, Thomas; Gürtler, Oliver - 2008
We consider a situation where an agent's effort is monitored by a supervisor who cares for the agent's well being. This is modeled by incorporating the agent's utility into the utility function of the supervisor. The first best solution can be implemented even if the supervisor's preferences are...
Persistent link: https://www.econbiz.de/10010365849
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Contracting with imperfect commitment and noisy communication
Bester, Helmut; Strausz, Roland - 2004 - Version 1.3, December 2004
This paper provides new analytical tools for studying principal-agent problems with adverse selection and limited commitment. By allowing the principal to use general communication devices we overcome the literature's common, but overly restrictive focus on one-shot, direct communication. In...
Persistent link: https://www.econbiz.de/10010361996
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Optimal delegated search with adverse selection and moral hazard
Ulbricht, Robert - 2014
The paper studies a model of delegated search. The distribution of search revenues is unknown to the principal and has to be elicited from the agent in order to design the optimal search policy. At the same time, the search process is unobservable, requiring search to be self-enforcing. The two...
Persistent link: https://www.econbiz.de/10010358239
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Mediation in situations of conflict and limited commitment
Mitusch, Kay; Strausz, Roland - 2004
We study the reasons and conditions under which mediation is beneficial when a principal needs information from an … mediator than through the agent himself. This implies that mediation is strictly helpful if and only if the likelihood of a … conflict of interest is positive but not too high. The value of mediation depends non-monotonically on the degree of conflict …
Persistent link: https://www.econbiz.de/10010366573
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Breaking up a research consortium
Niedermayer, Andras; Wu, Jianjun - 2013
Inter-firm R&D collaborations through contractual arrangements have become increasingly popular, but in many cases they are broken up without any joint discovery. We provide a rationale for the breakup date in R&D collaboration agreements. More specifically, we consider a research consortium...
Persistent link: https://www.econbiz.de/10010200195