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Multitasking and leadership in optimal incentive contracts

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  • Daido, Kohei
  • Murooka, Takeshi

Abstract

We study multitasking problems where an agent engages in both a contractible and a non-contractible task, which are substitutes. The agent has private information on the value of the non-contractible task, and there are followers (e.g., another agent, a third party, or a principal) who also contribute to this task. The agent’s effort can serve as a signal of the value as in the literature on leading-by-example (Hermalin, 1998). We derive the condition in which the principal provides high-powered incentives for the contractible task to mitigate the agent’s excessive signaling.

Suggested Citation

  • Daido, Kohei & Murooka, Takeshi, 2025. "Multitasking and leadership in optimal incentive contracts," Journal of Economic Behavior & Organization, Elsevier, vol. 229(C).
    • Handle: RePEc:eee:jeborg:v:229:y:2025:i:c:s0167268124004384
    DOI: 10.1016/j.jebo.2024.106824
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    More about this item

    Keywords

    Multitasking; Signaling; Leadership; Help;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D86 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Economics of Contract Law
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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