current CEO who may have considerable power. Having signed a contract, the agent chooses how much effort to make to acquire … problem; how much information to acquire and what investment decision to make. As a consequence, the equilibrium contracts in … model E involve both bonuses and penalties. We identify lower and upper bounds on these, and study how the bonus and bonus …

pressure. Nonetheless, when facing a penalty incentive scheme these individuals are more likely to choose to work with strict … term limits, suggesting that penalty contracts might generate adverse selection problems. …

Should contract design induce an agent to conduct a precontractual investigation even though, in any case, the agent … will become fully informed after the signing of the contract? This paper shows that imperfect investigations might be …

on the ex post payoff of the decision maker. The contract thus has to induce the experts to "monitor each other" by … making the transfers contingent on the entire vector of reports. We characterize the least costly contract that implements …