We consider a supplier of style goods who sells his products through a single retailer. Previous research has shown that there exists a continuum of buy-back contracts which can induce the retailer to order the system optimal quantity. In this paper we show that when forecasting choice is...

We introduce a new type of incentive contract for central bankers: inflation forecast contracts, which make central bankers’ remunerations contingent on the precision of their inflation forecasts. We show that such contracts enable central bankers to influence inflation expectations more...