Dynamic Agency with Feedback
AbstractA principal has a stochastically evolving target that he wishes an agent to repeatedly hit with his effort. The agent does not obtain utility from hitting the target and therefore attempts to shirk; the agent's utility is determined by a second process that symmetrically is of no use to the principal. The principal cannot control effort or payoffs but can transmit signals to the agent, who is relatively uninformed. The principal's optimal signal may cause the agent's labor to be highly serially correlated. This serial correlation has empirical relevance for the theory of managerial incentives and for the theory of business cycle fluctuations.
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.
Bibliographic InfoArticle provided by The RAND Corporation in its journal RAND Journal of Economics.
Volume (Year): 28 (1997)
Issue (Month): 3 (Autumn)
Contact details of provider:
Web page: http://www.rje.org
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Emir Kamenica & Matthew Gentzkow, 2009.
NajEcon Working Paper Reviews
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.