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Relational Incentive Contracts
[The Handbook of Organizational Economics]

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  • James M. Malcomson

Abstract

This chapter reviews the literature on the theory of relational incentive contracts.� It motivates the discussion by the classic applications of relational contracts to the GM-Fisher Body relationship and the relationships between Japanese automobile manufacturers and their subcontractors.� It presents basic models with symmetric information to illustrate the fundamental issues and then goes on to consider specific investments, the role of legally enforceable contracts alongside relational contracts, private information, multiple suppliers, and issues of organization design.

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This chapter was published in: Robert Gibbons & John Roberts (ed.) , Princeton University Press, Princeton, NJ, pages , 2012.

This item is provided by Princeton University Press in its series Introductory Chapters with number 9889-25.

Handle: RePEc:pup:chapts:9889-25

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Cited by:
  1. Robert Gibbons, 2010. "Inside Organizations: Pricing, Politics, and Path Dependence," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 337-365, 09.

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