Task-Specific Abilities in Multi-Task Agency Relations
AbstractThis paper analyzes a multi-task agency framework where the agent exhibits task-specific abilities. Besides investigating the appendant consequences of applying incongruent performance measures in incentive contracts, this paper demonstrates how the provision of incentives - including the optimal aggregation of information - takes the agent's task-specific abilities into consideration. It further emphasizes the relation between job characteristics and the principal's preference for selecting specific agents. This paper essentially demonstrates that differences in task-specific abilities across agents can provide a supplementary explanation of why they are allocated to various jobs; or why they receive different incentive contracts, even if their jobs are identical.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 2470.
Date of creation: 16 Feb 2007
Date of revision:
Task-specific human capital; performance measurement; distortion; multi-task agencies; congruence; incentives;
Find related papers by JEL classification:
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
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