We suggest a parsimonious dynamic agency model in which workers have status concerns. A firm is a promotion hierarchy in which a worker's status depends on past performance. We investigate the optimality of two types of promotion hierarchies: (i) internal labor markets, in which agents have a...

We study the impact of changes in the commitment power of a principal on cooperation among agents, in a model in which the principal and her agents are symmetrically uncertain about the agents' innate abilities. When the principal cannot commit herself to long-term wage contracts, two types of...

We suggest a parsimonious dynamic agency model in which workers have status concerns. A firm is a promotion hierarchy in which a worker's status depends on past performance. We investigate the optimality of two types of promotion hierarchies: (i) internal labor markets, in which agents have a...