When designing incentives for a manager, the trade-off between insurance and a "good" allocation of effort across various tasks is often identified with a trade-off between the responsiveness (sensitivity, precision, signal-noise ratio) of the performance measure and its similarity (congruity,...

When designing incentives for a manager, the trade-off between insurance and a "good" allocation of effort across various tasks is often identified with a trade-off between the responsiveness (sensitivity, precision, signal-noise ratio) of the performance measure and its similarity (congruity,...

I study the origin of people's beliefs about their own abilities, emphasizing the feedback loop between beliefs, effort, and outcomes. Consistent with the modern understanding of depression, I show that agents who are either more pessimistic about their own talent or less sure of their own...