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contract framing effect in either condition: effort provision is statistically indistinguishable under bonus and penalty …
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This paper develops a positive model of informal contracting in which rewards and punishments are not determined by an ex ante optimal plan but instead express the ex post moral sentiments of the arbitrating party. We consider a subjective performance evaluation problem in which a principal can...
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Under common law, the standard remedy for breach of contract is expectation damages. Under continental law, the …
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control sessions, incentives are formulated as a classic gain contract, while in treatment sessions, incentives are framed as … an isomorphic loss contract. Our results show that loss contracts reduce the minimum efforts of groups and worsen …
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We implement a laboratory experiment in which a principal has to decide on monitoring intensity and pay to investigate … be complements. The between-treatment variation in our experiment is qualitatively in line with the normative prediction …
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