We analyze the optimal choice of risk in a two-stage tournament game between two players that have different concave utility functions. At the first stage, both players simultaneously choose risk. At the second stage, both observe overall risk and simultaneously decide on effort or investment....

We analyze the optimal choice of risk in a two-stage tournament game between two players that have different concave utility functions. At the first stage, both players simultaneously choose risk. At the second stage, both observe overall risk and simultaneously decide on effort or investment....

We analyze the optimal choice of risk in a two-stage tournament game  between two players that have different concave utility functions. At the first stage, both players simultaneously choose risk. At the second stage, both observe overall risk and simultaneously decide on effort or investment....

We analyze the optimal choice of risk in a two-stage tournament game between two players that have different concave utility functions. At the first stage, both players simultaneously choose risk. At the second stage, both observe overall risk and simultaneously decide on effort or investment....

What is the impact of firms' productivity shocks on workers' labor earnings? To answer this question, we propose a novel approach to identify firms' productivity shocks that combines a nonparametric production function estimation method with a set of two-way fixed effect regressions to control...

Economic partners – like masters and apprentices – produce benefits for each other. Yet, they are often subject to contracting limitations that restrict their actions, and thus the benefits they produce and receive. We characterize the relationship between (contracting) limitations and...

This study examines whether companies employ corporate social responsibility (CSR) to improve employee engagement and mitigate adverse behavior at the workplace (e.g., shirking, absenteeism, etc.). We exploit plausibly exogenous changes in state unemployment insurance (UI) benefits from 1991 to...

This paper develops a simple theory of pay structures and pay levels across heterogeneous agents by bringing together optimal contracts inside the firm and competitive resource allocation in the market. The central idea is that more talented people tend to create greater value but face larger...

Lecture on the first SFB/TR 15 meeting, Gummersbach, July, 18 - 20, 2004: The existing literature on the comparison of tournaments and piece rates as alternative incentive schemes has focused on the case of unlimited liability. However, in practice real workers' wealth is typically restricted....

The existing literature on the comparison of tournaments and piece rates as alternative incentive schemes has focused on the case of unlimited liability. However, in practice real workers' wealth is typically restricted. Therefore, this paper compares both schemes under the assumption of limited...