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derive the optimal contract for both experimentation and production when the agent has private information about his … asymmetric information is endogenously determined by the length of the experimentation stage. An optimal contract uses the length …
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We study the economic consequences of opportunities for dishonesty in an environment where efficiency relevant behaviour is not contractible, but rather incentivized by informal agreements in an ongoing relationship. We document the repeated interaction between a principal and an agent who,...
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We implement a laboratory experiment in which a principal has to decide on monitoring intensity and pay to investigate whether they are complements or substitutes. Wage level, monitoring intensity, and consequently the desired enforceable effort level are jointly determined by the maximization...
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two economically equivalent contracts - a fixed-term renewable and an open-ended at-will contract. Each contract provides … contract type. However, when both contracts are available offering a fixed-term instead of an open-ended contract is perceived …We investigate how payoff-irrelevant terms can negatively impact relational contracts. In a lab experiment we compare …
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