We relate the design of contract law to the process of development. In this paper, contract law defines which private agreements are enforceable (i.e. are binding and enforced by courts) and which are not. Specically, we consider an economy where agents face a hold-up problem (moral hazard in...

I compare group to individual performance pay when workers are envious and performance is non-verifiable. Avoiding payoff inequity, the group bonus contract is superior as long as the firm faces no credibility problem. The individual bonus contract may, however, become superior albeit...

We address empirically the issues of the optimality of simple linear compensation contracts and the importance of asymmetries between firms and workers. For that purpose, we consider contracts between the French National Institute of Statistics and Economics (Insee) and the interviewers it hired...

Joint-liability is maybe the most distinctive feature of microfinance contracts in developing countries. Yet, very little evidence exists on the impact of joint-liability contracts as compared to individual lending contracts. On the one hand, theory claims that joint-liability plays a key role...

I use the standard screening model to study the relationship between bribes and red tape. I argue that bribe-taking bureaucrats extract bribes by exploiting differences in firms' marginal costs of red tape and offer a menu of bribes and paperwork processing times, where a larger bribe is...

In this paper we analyze the factors that affect the choice of land tenure contracts in the semi arid tropics of India. We develop a dynamic principal-agent model with one-sided private information to explain the co-existence of wage, rent and share-cropping contracts. We generate empirically...

While it is clear that in most settings, landlords generally contract with many tenants whose productivities are positively correlated, the salience of relative performance evaluation in the design of rural wage contracts has been little studied in development economics. This paper analyzes two...

The object of this essay is to describe and analyse contractual relations in two villages in North-east Bihar at a time when the so-called ‘green revolution’ promised much and the region had just started to benefit from canal irrigation. It is against this historical background that I will...