This study investigates experimentally how mutual monitoring affects effort when employees are compensated via rank-order tournaments. Theory and anecdotal evidence suggest that mutual monitoring may either decrease effort by facilitating collusion or increase effort by stimulating competition....

"In this paper, we compare subjective principal assessments of teachers to the traditional determinants of teacher compensation ŁV education and experience ŁV and another potential compensation mechanism -- value-added measures of teacher effectiveness based on student achievement gains. We...

We analyze the costs and benefits of using social image to foster virtuous behavior. A Principal seeks to motivate reputation-conscious agents to supply a public good. Each agent chooses how much to contribute based on his own mix of public-spiritedness, private signal about the value of the...