In the design of procurement contracts, cost sharing, wherein the contractor receives a fixed fee plus a fraction of his cost, is common when the cost for completing the project is uncertain. We determine the best cost-sharing contract between a risk-neutral project manager and a risk-averse...

In this chapter we study a team dynamic problem in which a group of agents collaborate over time to complete a project. The project progresses at a rate that depends on the agents' efforts, and it generates a payoff upon completion. First, we show that agents work harder the closer the project...