The Virtue of Being Underestimated: A Note on Discriminatory Contracts in Hidden Information Models
AbstractA standard hidden information model is considered to study the influence of the a priori productivity distribution on the optimal contract. A priori more productive (hazard rate dominant) agents work less, enjoy lower rents, but generate a higher expected surplus.
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 InfoPaper provided by University of Bonn, Germany in its series Bonn Econ Discussion Papers with number bgse18_2001.
Date of creation: Jun 2001
Date of revision:
Contact details of provider:
Postal: Bonn Graduate School of Economics, University of Bonn, Adenauerallee 24 - 26, 53113 Bonn, Germany
Fax: +49 228 73 6884
Web page: http://www.bgse.uni-bonn.de
adverse selection; statistical discrimination; stochastic order relation;
Other versions of this item:
- Schnedler, Wendelin, 2002. "The virtue of being underestimated: a note on discriminatory contracts in hidden information models," Economics Letters, Elsevier, vol. 75(2), pages 171-178, April.
- Schnedler, Wendelin, 2001. "The Virtue of Being Underestimated: A Note on Discriminatory Contracts in Hidden Information Models," IZA Discussion Papers 342, Institute for the Study of Labor (IZA).
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-09-26 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, December.
- Nahum D. Melumad & Dilip Mookherjee & Stefan Reichelstein, 1995. "Hierarchical Decentralization of Incentive Contracts," RAND Journal of Economics, The RAND Corporation, vol. 26(4), pages 654-672, Winter.
- Wendelin Schnedler, 2011.
"You Don't Always Get What You Pay For: Bonuses, Perceived Income and Effort,"
German Economic Review,
Verein für Socialpolitik, vol. 12(1), pages 1-10, 02.
- Wendelin Schnedler, 2009. "You Don't Always Get What You Pay For: Bonuses, Perceived Income, and Effort," The Centre for Market and Public Organisation 09/226, Department of Economics, University of Bristol, UK.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (BGSE Office).
If references are entirely missing, you can add them using this form.