Relational Incentives and Moral Hazard in Teams
AbstractThis paper studies moral hazard in teams using a model where efforts are promoted via the combination of profit shares and relational contracts. The focus is on how these two forms of incentives interact. According to the degree of effort observability and the importance of future interaction, the optimal allocation of profit shares can range from a wide dispersion across players to a full concentration of shares in the hands of a single player. When shares are sufficiently concentrated, the corresponding residual claimant can also adopt the role of administering all relational contracts, therefore serving as an endogenously chosen principal. Copyright 2007, Wiley-Blackwell.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Oxford University Press in its journal The Review of Economic Studies.
Volume (Year): 74 (2007)
Issue (Month): 3 ()
Contact details of provider:
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Sloof, Randolph & Sonnemans, Joep, 2011.
"The interaction between explicit and relational incentives: An experiment,"
Games and Economic Behavior,
Elsevier, vol. 73(2), pages 573-594.
- Randolph Sloof & Joep Sonnemans, 2009. "The Interaction between Explicit and Relational Incentives: An Experiment," Tinbergen Institute Discussion Papers 09-030/1, Tinbergen Institute.
- Sebastian Kranz, 2013.
"Relational Contracting, Repeated Negotiations, and Hold-Up,"
Cowles Foundation Discussion Papers
1888, Cowles Foundation for Research in Economics, Yale University.
- Kranz, Sebastian, 2013. "Relational Contracting, Repeated Negotiations, and Hold-Up," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 80047, Verein für Socialpolitik / German Economic Association.
- Sebastian Kranz, 2013. "Relational Contracting, Repeated Negotiations, and Hold-Up," Levine's Working Paper Archive 786969000000000676, David K. Levine.
- Saak, Alexander E., 2013. "Traceability and Reputation in Supply Chains," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 149988, Agricultural and Applied Economics Association.
- Ola Kvaløy & Trond Olsen, 2014.
"Teams and Tournaments in Relational Contracts,"
CESifo Working Paper Series
4783, CESifo Group Munich.
- Goldlücke, Susanne & Kranz, Sebastian, 2012. "Delegation, monitoring, and relational contracts," Economics Letters, Elsevier, vol. 117(2), pages 405-407.
- Tim Worrall & Jonathan P Thomas, 2008.
"Dynamic Relational Contracts with Consumption Constraints,"
2008 Meeting Papers
324, Society for Economic Dynamics.
- Jonathan P Thomas & Tim Worrall, 2007. "Dynamic Relational Contracts with Consumption Constraints," Keele Economics Research Papers KERP 2007/16, Centre for Economic Research, Keele University.
- repec:dgr:uvatin:2009030 is not listed on IDEAS
- Goldlücke, Susanne & Kranz, Sebastian, 2013. "Renegotiation-proof relational contracts," Games and Economic Behavior, Elsevier, vol. 80(C), pages 157-178.
- James M. Malcomson, 2012.
"Relational Incentive Contracts
[The Handbook of Organizational Economics]," Introductory Chapters, Princeton University Press.
- repec:dgr:uvatin:2009027 is not listed on IDEAS
- David A. Miller & Joel Watson, 2013. "A Theory of Disagreement in Repeated Games With Bargaining," Econometrica, Econometric Society, vol. 81(6), pages 2303-2350, November.
- Sebastian Kranz, 2012.
"Discounted Stochastic Games with Voluntary Transfers,"
Cowles Foundation Discussion Papers
1847, Cowles Foundation for Research in Economics, Yale University.
- Sebastian Kranz, 2012. "Discounted Stochastic Games with Voluntary Transfers," Levine's Working Paper Archive 786969000000000423, David K. Levine.
- Hajime Kobayashi & Katsunori Ohta & Tadashi Sekiguchi, 2008. "Optimal Sharing Rules in Repeated Partnerships," KIER Working Papers 650, Kyoto University, Institute of Economic Research.
- Goldlücke, Susanne & Kranz, Sebastian, 2012.
"Infinitely repeated games with public monitoring and monetary transfers,"
Journal of Economic Theory,
Elsevier, vol. 147(3), pages 1191-1221.
- Goldluecke, Susanne & Kranz, Sebastian, 2010. "In?nitely Repeated Games with Public Monitoring and Monetary Transfers," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 332, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
- Nick Vikander, 2009. "The Breakdown of Morale," Tinbergen Institute Discussion Papers 09-027/1, Tinbergen Institute.
- Ishida, Junichiro, 2009. "Incentives in academics: Collaboration under weak complementarities," Labour Economics, Elsevier, vol. 16(2), pages 215-223, April.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.