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 … in a lower worker's profit ratio in both scenarios. …

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 … worker's profit ratio in both scenarios. …

The 1/n problem potentially limits the effectiveness of profit sharing in motivating workers. While the economic … unproductive effort such as socializing on the job. The model implies that reciprocity increases profit up to a point but decreases … profit beyond that point. Using detailed survey measures of worker reciprocity, we show that the probability of receiving …