evaluation to the agent if the evaluation turns out to be bad. The justification assures the agent that the principal has not … her evaluation. For good performance, however, the principal pays a constant high wage without justification. Furthermore …Should principals explain and justify their evaluations? In this paper the principal's evaluation is private …

possesses no capital and enjoys limited liability, so cannot be sold the project. The optimal long-term contract involves … impact of hiring an expert, and show how the optimal contract changes when the expert has initial capital, can be replaced …

choice is more accurate than a noisy public performance measure. For some contingencies the optimal contract has to specify … the loss from termination is small. Under an optimal contract the agent's wage may depend only on the principal's report … and not on the public signal. Nonetheless, public information is valuable as it facilitates truthful subjective evaluation …

choice is more accurate than a noisy public performance measure. For some contingencies the optimal contract has to specify … the loss from termination is small. Under an optimal contract the agent's wage may depend only on the principal's report … and not on the public signal. Nonetheless, public information is valuable as it facilitates truthful subjective evaluation …

delegate more often than under verifiable effort costs. Moreover, we show that the benefit of communication between the … delegation may be preferred over truthful communication …

. Furthermore, since some workers do not reciprocate the principal's altruism, the principal may find it optimal to write a contract … that simultaneously signals his altruism and screens reciprocal worker types. Such a contract is characterised by …

. Furthermore, since some workers do not reciprocate the principal's altruism, the principal may find it optimal to write a contract … that simultaneously signals his altruism and screens reciprocal worker types. Such a contract is characterized by …

that the principal cares for them. Principals can signal their altruism by offering a generous contract, consisting of a … agents do not reciprocate the principal's altruism, the principal may find it optimal to write a contract that simultaneously … signals his altruism and screens reciprocal worker types. I show that such a contract is characterised by excessively strong …