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Subjective Evaluations: Discretionary Bonuses and Feedback Credibility
Fuchs, William - 2013
We provide a new rationale for the use of discretionary bonuses. In a setting with unknown match qualities between a worker and a firm and subjective evaluations by the principal, bonuses are useful in order to make the feedback from the firm to the workers credible. This way workers in good...
Persistent link: https://www.econbiz.de/10010329084
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Structural Empirical Evaluation of Job Search Monitoring
van den Berg, Gerard J.; van der Klaauw, Bas - 2013
We structurally estimate a novel job search model with endogenous job search effort, job quality dispersion, and effort monitoring, taking into account that monitoring effects may be mitigated by on-the-job search and search channel substitution. The data are from a randomized experiment...
Persistent link: https://www.econbiz.de/10010329217
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Dynamic Contracts and Learning by Doing
Prat, Julien - 2014
This paper studies the design of optimal contracts in dynamic environments where agents learn by doing. We derive a condition under which contracts are fully incentive compatible. A closed-form solution is obtained when agents have CARA utility. It shows that human capital accumulation...
Persistent link: https://www.econbiz.de/10010333325
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Cognitive Ability and Paternalism
Saint-Paul, Gilles - 2002
This paper analyses the welfare effects of price restrictions on private contracting in a world where agents have a limited cognitive ability. People compute the costs and benefits of entering a transaction with an error. The government knows the distribution of true costs and benefits as well...
Persistent link: https://www.econbiz.de/10010262616
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Dynamic incentive contracts under parameter uncertainty
Prat, Julien; Jovanovic, Boyan - 2010
We analyze a long-term contracting problem involving common uncertainty about a parameter capturing the productivity of the relationship, and featuring a hidden action for the agent. We develop an approach that works for any utility function when the parameter and noise are normally distributed...
Persistent link: https://www.econbiz.de/10010278382
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Network architecture and mutual monitoring in public goods experiments
Carpenter, Jeffrey; Kariv, Shachar; Schotter, Andrew - 2010
punish each other (i.e., in a complete network). The architecture of social networks becomes important when individuals can … only monitor and punish the other individuals to whom they are connected by the network. We study several non …-trivial network architectures that give rise to their own distinctive patterns of behavior. Nevertheless, a number of simple, yet …
Persistent link: https://www.econbiz.de/10010278606
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Simultaneous Search and Adverse Selection
Auster, Sarah; Gottardi, Piero; Wolthoff, Ronald P. - 2024
We study the effect of diminishing search frictions in markets with adverse selection by presenting a model in which agents with private information can simultaneously contact multiple trading partners. We highlight a new trade- off: facilitating contacts reduces coordination frictions but also...
Persistent link: https://www.econbiz.de/10014534006
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Behavioral Aspects of Communication in Organizations
Casoria, Fortuna; Riedl, Arno; Werner, Peter - 2020
This paper reviews experimental studies that investigate the effects of communication on behavior in organizational settings. Two main classes of studies are identified: (a) studies on coordination and competition, which include experimental research that tests whether communication can help to...
Persistent link: https://www.econbiz.de/10012207686
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Search, Screening and Sorting
Cai, Xiaoming; Gautier, Pieter A.; Wolthoff, Ronald P. - 2021
We investigate the effect of search frictions on labor market sorting by constructing a model which is in line with recent evidence that employers collect a pool of applicants before interviewing a subset of them. In this environment, we derive the necessary and sufficient conditions for sorting...
Persistent link: https://www.econbiz.de/10012658080
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It Hurts to Ask
Benabou, Roland; Jaroszewicz, Ania; Loewenstein, George - 2022
We analyze the offering, asking, and granting of help or other benefits as a three-stage game with bilateral private information between a person in need of help and a potential help-giver. Asking entails the risk of rejection, which can be painful: since unawareness of the need can no longer be...
Persistent link: https://www.econbiz.de/10013426425