Gottfries, Nils; Sjostrom, Tomas - In: Scandinavian Journal of Economics 97 (1995) 2, pp. 281-94
A contract between a risk-neutral firm and its risk-averse workers is considered under uncertainty about product demand. The authors show that profit sharing can be used to attain the efficient level of employment and, at the same time, preserve optimal risk sharing between the parties. Optimal...