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Learning-by-Doing; Consequences for Incentive Design

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Author Info

  • Osmundsen, P.

Abstract

Through a learning-by-doing process, a firm's efficiency depends positively on the extent of its previous business activity. From a dynamic incentives perspective, therefore, efficiency is endogenous. In addition, the efficiency of the firm is likely to be subject to private information. The model captures some of the trade-offs principals face in designing incentive schemes in this context.

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Bibliographic Info

Paper provided by Norwegian School of Economics and Business Administration- in its series Papers with number 12/98.

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Length: 8 pages
Date of creation: 1998
Date of revision:
Handle: RePEc:fth:norgee:12/98

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Postal: NORWEGIAN SCHOOL OF ECONOMICS AND BUSINESS ADMINISTRATION, HELLEVEIEN 30, 5035 BERGEN SANDVIKEN NORWAY.
Phone: 5595 9000
Fax: 5595 9100
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Web page: http://www.nhh.no/
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Related research

Keywords: INCENTIVES ; CONTRACTS ; INFORMATION;

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References

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  1. Maggi G. & Rodriguez-Clare A., 1995. "On Countervailing Incentives," Journal of Economic Theory, Elsevier, vol. 66(1), pages 238-263, June.
  2. Baron, David P. & Besanko, David, 1984. "Regulation and information in a continuing relationship," Information Economics and Policy, Elsevier, vol. 1(3), pages 267-302.
  3. repec:fth:inseep:9609 is not listed on IDEAS
  4. Jean Tirole & Jean-Jaques Laffont, 1985. "Using Cost Observation to Regulate Firms," Working papers 368, Massachusetts Institute of Technology (MIT), Department of Economics.
  5. Lewis, Tracy R. & Sappington, David E. M., 1989. "Countervailing incentives in agency problems," Journal of Economic Theory, Elsevier, vol. 49(2), pages 294-313, December.
  6. Osmundsen, P. & Hagen, K. P. & Schjelderup, G., 1998. "Internationally mobile firms and tax policy1," Journal of International Economics, Elsevier, vol. 45(1), pages 97-113, June.
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Cited by:
  1. Klenio Barbosa & Pierre C. Boyer, 2012. "Discrimination in Dynamic Procurement Design with Learning-by-doing," CESifo Working Paper Series 3947, CESifo Group Munich.

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