This paper studies the impact of labour taxation in a shirking model with wage bargaining.It is shown that if the ratio of unemployment compensation to the net-of-tax wage iskept fixed a tax cut leads to higher unemployment. When the unemployment benefitsreplacement ratio is allowed to change,...

We examine the impact of economic deregulation on employer evasion of union-mandated "formal" wage-contracts in an import-competing industry. We show that, if the state maintains industrial employment despite import liberalisation, through cheaper credit to firms, then employer evasion will...

We are interested in the macroeconomic implications of the separation of ownership andcontrol. An alternative decentralized interpretation of the stochastic growth model isproposed, one where shareholders hire a self-interested manager who is in charge of thefirm's hiring and investment...

Als zentralem Bestandteil der internationalen Finanzarchitektur kommt dem Internationalen Währungsfonds (IWF) heutzutage immer öfter die Aufgabe zu, bei Verschuldungskrisen souveräner Staaten, insbesondere weit fortgeschrittener Schwellen- und Transformationsländer, als multilateraler...

This paper studies a setting in which a risk averse agent must be motivatedto work on two tasks: he (1) evaluates a new project and, if adopted, (2)manages it. While a performance measure which is informative of an agent’saction is typically valuable because it can be used to improve the risk...

We consider guilt averse agents and principals and study the effects ofguilt on optimal behavior of the principal and the agent in a moral hazardmodel.The principal’s contract proposal contains a target effort in addition tothe monetary incentive scheme. By accepting the agreement, the...