Two new bargaining games, called "Freedom to Punish (FTP)" and "Right and Choice to Punish (RAP)", are developed, analyzed and tested by means of an experimental implementation. Hypotheses about behavior are developed, discussed and tested. The central hypotheses are aimed at the importance of...

Theoretical analyses of (optimal) performance measures are typically performed within therealm of the linear agency model. This model implies that, for a given compensation scheme,the agent's optimal effort is unrelated to the amount of noise in the performance measure...