Reputation effects and other-regarding preferences have both been used to predict cooperative outcomes in markets with inefficient equilibria. Existing reputation-building models require either infinite time horizons or publicly observed identities, but cooperative outcomes have been observed in...

This paper is concerned with the incentive properties of the St Matthew Effect by which since Merton [1968] one usually describing the various cumulative advantages that obviously affect academic competition. We introduce a model of sequential contests in which the agents that have initially...

This paper is concerned with the incentive properties of the Matthew Effect by which since Merton [1968] one is usually describing the various cumulative advantages that obviously affect academic competition. We introduce a model of sequential contests in which the agents that have initially...

The efficiency wage theory developed by Akerlof (1982) assumes observability of effort and the ability of firm and worker to commit on their effort/wage decisions. We show that, from a game theoretical point of view, we have to understand the firm/worker relationship as a repeated Prisoner's...

For the past forty years, scholars have developed an immense literature devoted to understanding and solving the tragedy of the commons. The most prominent solutions to this tragedy have focused on building and maintaining stable institutions. This Article reexamines this foundational literature...

We introduce a dynamic principal-agent model to understand the nature of contracts between an employer and an independent gig worker. We model the worker's self-respect with an endogenous participation constraint; he accepts a job offer if and only if its utility is at least as large as his...

We develop a model of strategic contractual incompleteness that identifies conditions under which principals might omit even costlessly verifiable terms. We then use experiments to test comparative statics predictions of the model. While it is well known that verifiability imperfections can...

We develop a model of strategic contractual incompleteness that identifies conditions under which principals might omit even costlessly verifiable terms. We then use experiments to test comparative statics predictions of the model. While it is well known that verifiability imperfections can...

I consider a repeated principal-agent setting in which the agent repeatedly chooses between hidden “long-term” and “short-term” actions. Relative to the long-term action, the short-term action boosts output today but hurts output tomorrow. The optimal contract inducing long-term actions...

This study investigates the structure of optimal incentives in a stochastic environment and provides evidence for the use of self-enforcing relational contracts. We show theoretically that under relational contracting, firms can credibly promise chief executive officers (CEOs) larger bonuses in...