Casadesus-Masanell, Ramon - In: Journal of Economics & Management Strategy 13 (2004) 3, pp. 375-404
Existing models of the principal-agent relationship assume the agent works only under extrinsic incentives. However, many observed agency contracts take the form of a fixed payment. For such contracts to work, the principal must trust the agent to work in the absence of incentives. I show that...