It is s important for firms to choose appropriate performance measurements when they evaluate their employees' performance. In this paper, we examine the relationship between uncertainty and incentives in which the risk-averse agent has the specific knowledge. We show that uncertainty does not...

A standard tournament contract specifies only tournament prizes. If agents' performance is measured on a cardinal scale, the principal can complement the tournament contract by a gap which defines the minimum distance by which the best performing agent must beat the second best to receive the...