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Recursive Contracts

Author

Listed:
  • Marcet, A.
  • Marimon, R.

Abstract

The authors obtain a recursive formulation for a general class of contracting problems involving incentive constraints. These constraints make the corresponding maximization (sup)problems non recursive. Our approach consists of studying a recursive Lagrangian.

Suggested Citation

  • Marcet, A. & Marimon, R., 1998. "Recursive Contracts," Economics Working Papers eco98/37, European University Institute.
    • Handle: RePEc:eui:euiwps:eco98/37
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    More about this item

    Keywords

    CONTRACTS ; MOTIVATION;

    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General

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