Essays on incentive contracts under moral hazard and non-verifiable performance [Elektronische Ressource] / von Anja Schoettner

Anja Schöttner

Sujets

• Mathematics

Informations

• Publié par: humboldt-universitat_zu_berlin
• Publié le: 01 janvier 2005
• Nombre de lectures: 31
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Essays on Incentive Contracts under Moral Hazard
and Non-Veri able Performance
DISSERTATION
zur Erlangung des akademischen Grades
doctor rerum politicarum
(Doktor der Wirtschaftswissenschaft)
eingereicht an der
Wirtschaftswissenschaftlichen Fakultat
der Humboldt-Universitat zu Berlin
von
Frau Dipl.-Wirt.-Math. Anja Schottner
geboren am 11.11.1977 in Aschersleben
Prasident der Humboldt-Universitat zu Berlin:
Prof. Dr. Jurgen Mlynek
Dekan der Wirtschaftswissenschaftlichen Fakultat:
Prof. Dr. Joachim Schwalbach
Gutachter:
1. Prof. Dominique Demougin, Ph.D.
2. Prof. Dr. Oliver Fabel
Tag des Kolloquiums: 10. Juni 2005Abstract
This thesis consists of four self-contained essays that compare real-world incentive
schemes used to mitigate moral hazard problems under non-veriable performance.
Therstessaycontraststheimpactoftheprecisionofperformancemeasurement
onwagecostsinU-andJ-typetournaments. InU-typetournamentsprizesarexed.
In J-type tournaments only an overall wage sum is specied. The principal prefers
a U-type tournament if workers receive a rent under limited liability and the costs
of increasing precision are low. However, if workers are inequity-averse and have
unlimited liability, the J-type tournament leads to lower wage costs.
Thesecondessayanalyzesoptimaljobdesignwhenthereis onlyone contractible
and imperfect performance measure for all tasks whose contribution to rm value
is non-veriable. Task splitting is optimal when relational contracts based on rm
value are not feasible. By contrast, if an agent who performs a given set of tasks
receivesanimplicitbonus, theprincipalalwaysbene tsfromassigninganadditional
task to this agent.
The third essay compares an auction and a tournament in a procurement setting
with non-contractible quality signals. Signals are a ected by rms’ non-observable
investments in R&D and the procurer’s precision of quality measurement. Although
investments are always higher with the auction, the procurer may prefer the tourna-
mentifmarginalcostsofqualitymeasurementarehighortheproductiontechnology
for quality is highly random.
In the last essay, a principal wants to induce two agents to produce an output.
Agents can undertake non-contractible investments to reduce production cost of the
output. Part of this innovation spills over and also reduces production cost of the
other agent. Agents always underinvest with a general output price subsidy, while
they may or may not do so with an innovation tournament. Strong spillovers tend
to favor a general output price subsidy.
Keywords:
Tournaments, Relational Contracts, Multi-Tasking, Innovation Contests