A highly acclaimed result in contract theory is that tournaments are superior to piece rate contracts when the agents are risk averse and their production activities are subject to a relatively large common shock. The reason is that tournaments allow the principal to trade insurance for lower...

The three essays of this thesis research model selection and estimation issues in financial econometrics. Special attention is given to comparing various approaches used previously in the literature and attempting to compare their out-of-sample performance. Chapter two explores the value of...

I examine properties of worker behavior under promotion tournaments, and discuss their implications for the design of promotion tournaments. Given their tasks, workers will decide how much effort they exert. In addition to this decision-making, they have the opportunity to decide their...