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Persistent link: https://www.econbiz.de/10012622307
This paper investigates optimal contracts between risk-neutral parties when both exert efforts and the agent faces limited liability. It is shown that a simple share-or-nothing with bonus contract (SonBo for short) is optimal and implements the second-best outcome, i.e., the best possible...
Persistent link: https://www.econbiz.de/10012834125