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. Our results are consistent with the theory of strategic ambiguity of Bernheim and Whinston (1998) and can be rationalized …
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How can a principal (an agent) ensure that an agent (a principal) will work (pay up), if payment (work) precedes work (payment)? When a banknote is torn in two, each part is by itself worthless. A principal can pre-commit to payment-on-delivery, by tearing a banknote and giving the agent the...
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