Efficiency wage effects of profit sharing are combined with option values related to stochastic future profit variations. These option effects occur if the workers' profit share is fixed by long-term contracts. The Pareto-improving optimal level of the sharing ratio is calculated for two...

Efficiency wage effects of profit sharing are combined with option values related to stochastic future pofit variations. These option effects occur if the workers' profit share is fixed by long-term contracts. The Pareto-improving optimal level of the sharing ratio is calculated for two...

The purpose of this note is to explore the problem of non-convex labor supply decision in an economy with reciprocity in labor relations ("gift exchange") a la Danthine and Kurmann (2010), and explicitly perform the aggregation presented in Vasilev (2017) without a formal proof, and thus provide...

This paper explores the implications of gender-based income taxation in a non-cooperative model of a couple's time allocation between market work and providing a household public good. We find that the optimal structure of differential taxation by gender is solely determined by spouses' relative...

The 1/n problem potentially limits the effectiveness of profit sharing in motivating workers. While the economic literature suggests that reciprocity can mitigate this problem, it remains silent on the optimal degree of reciprocity. We present a representative model demonstrating that...