We extend the neoclassical investment model Hayashi (1982) to allow for limited commitment on compensation contracts …. We consider three types of limited commitment: i) managers cannot commit to compensation contracts that provide lower …

We study non-contractible intangible investment in a dynamic agency model with multitasking. The manager's short …-term task determines current performance which deteriorates with investment in the firm's future profitability, his long …-term task. The optimal contract dynamically balances incentives for short- and long-term performance such that investment is …

find that during periods of import tariff cuts and the global financial crisis, investment and firm value are higher for …