On the existence of share contracts under limited liability
AbstractIn a principal-agent relationship under limited liability, the agent in general receives the full share of revenue. We show that when the agent exerts effort in multiple tasks, the effort substitution effect helps explain the existence of share contracts even under limited liability.
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Bibliographic InfoArticle provided by Elsevier in its journal Economics Letters.
Volume (Year): 117 (2012)
Issue (Month): 3 ()
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Web page: http://www.elsevier.com/locate/ecolet
Multitasking; Effort substitution; Share contracts;
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