This article develops a multitask model in which the agent has to produce both verifiable and unverifiable outputs in a dynamic framework as observed in actual labor markets and practices. The model derives an important result regarding the timing and the length of a wage contract. A short-term...

This paper explores one reason why a corporate board often fails to replace a substandard CEO. I consider the situation in which the incumbent CEO and direscotrs make decisions in the absence of the new CEO. I show that in this situation, which is common in practice, the board and the CEO end up...

　　 Why do some employees receive only …xed or incentive pay, while others receive a mix of …xed and incentive pay? Moreover, why do the lengths of wage contracts di¤er across these types of pay? This paper attempts to respond to this economic puzzle by developing a...

This paper shows how a socially and environmentally aware firm principal can motivate a profit-oriented manager to pursue positive environmental, social, and governance (ESG) outcomes. In the model, the manager produces a verifiable output that creates social costs but also engages in an...