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Delegated portfolio management: a survey of the theoretical literature

Stracca, Livio - 2005

of portfolio managers, the role of reputational concerns in a multiperiod framework, and the incentives to noise trading …

Persistent link: https://www.econbiz.de/10011604566

Bonus culture: Competitive pay, screening, and multitasking

Bénabou, Roland; Tirole, Jean - 2013

This paper analyzes the impact of labor market competition and skill-biased technical change on the structure of … compensation. The model combines multitasking and screening, embedded into a Hotelling-like framework. Competition for the most … perfect competition, the resulting efficiency loss can be much larger than that imposed by a single firm or principal, who …

Persistent link: https://www.econbiz.de/10010293214

You Don't Always Get What You Pay For

Schnedler, Wendelin - 2007

Consider a principal-agent relationship in which more effort by the agent raises the likelihood of success. Does rewarding success, i.e., paying a bonus, increase effort in this case? I find that bonuses have not only an incentive but also an income effect. Overall, bonuses paid for success may...

Persistent link: https://www.econbiz.de/10011422168

Standards and Incentives under Moral Hazard with Limited Liability

Reinshagen, Felix - 2012

We consider a model of moral hazard with limited liability of the agent and effort that is two-dimensional. One dimension of the agent’s effort is observable and the other is not. The principal can thusmake the contract conditional not only on outcome but also on observable effort. The...

Persistent link: https://www.econbiz.de/10010427619

Limited Liability and the Risk-Incentive Relationship

Budde, Jörg; Kräkel, Matthias - 2008

Several empirical findings have challenged the traditional view on the trade-off between risk and incentives. By combining risk aversion and limited liability in a standard principal-agent model the empiri- cal puzzle on the positive relationship between risk and incentives can be explained....

Persistent link: https://www.econbiz.de/10010264917

You don't always get what you pay for

Schnedler, Wendelin - 2007

Persistent link: https://www.econbiz.de/10010268396

The Pygmalion effect : an agency model with reference dependent preferences

Daido, Kohei; Itoh, Hideshi - 2005

We attempt to formulate and explain two types of self-fulfilling prophecy, called the Pygmalion effect (if a supervisor thinks her subordinates will succeed, they are more likely to succeed) and the Galatea effect (if a person thinks he will succeed, he is more likely to succeed). To this...

Persistent link: https://www.econbiz.de/10010261169

Observing Unobservables: Identifying Information Asymmetries with a Consumer Credit Field Experiment

Karlan, Dean S.; Zinman, Jonathan - 2005

Information asymmetries are important in theory but difficult to identify in practice. We estimate the empirical …

Persistent link: https://www.econbiz.de/10010369211

Wage floors and optimal job design

Kragl, Jenny; Schöttner, Anja - 2011

We analyze the effects of lower bounds on wages, e.g., minimum wages or liability limits, on job design within firms. In our model, two tasks contribute to non-veriable firm value and affect an imperfect performance measure. The tasks can be assigned to either one or two agents. In the absence...

Persistent link: https://www.econbiz.de/10010293373

On the Prudence of Rewarding A While Hoping For B

Schnedler, Wendelin - 2003

In multiple-task hidden-action models, the (mis-)allocation of effort may play an important role for benefit creation. Signals which capture this benefit and which are used in incentive schemes should thus not only be judged by the noise and the associated costs but also by the mis-allocation...

Persistent link: https://www.econbiz.de/10010263061

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