IDEAS home Printed from https://ideas.repec.org/a/ier/iecrev/v36y1995i4p1051-56.html
   My bibliography  Save this article

Optimal Contracts for Teams: A Note

Author

Listed:
  • Vander Veen, Thomas D

Abstract

In a team subject to adverse selection and moral hazard, R. P. McAfee and J. MacMillan (1991) found, surprisingly, that, under certain conditions, the outcome is unaffected whether the principal observes only total output or whether the principal can observe each person's individual contribution to the production of the output. This leads McAfee and MacMillan to conclude that the purpose of monitoring is to discipline the monitor. However, when team members are risk averse, the principal can benefit by monitoring. Copyright 1995 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Suggested Citation

  • Vander Veen, Thomas D, 1995. "Optimal Contracts for Teams: A Note," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 36(4), pages 1051-1056, November.
    • Handle: RePEc:ier:iecrev:v:36:y:1995:i:4:p:1051-56
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0020-6598%28199511%2936%3A4%3C1051%3AOCFTAN%3E2.0.CO%3B2-X&origin=bc
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Thierry Granger, 1997. "Le renouveau de la théorie des organisations. Lecture critique de trois ouvrages récents," Revue Économique, Programme National Persée, vol. 48(1), pages 147-180.
    2. Parimal K. Bag & Peng Wang, 2019. "Dominance of contributions monitoring in teams," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 53(3), pages 467-495, October.
    3. Breton, Michèle & St-Amour, Pascal & Vencatachellum, Désiré, 1998. "Birds of a Feather: Teams as a Screening Mechanism," Cahiers de recherche 9808, Université Laval - Département d'économique.
    4. Breton, Michele & St-Amour, Pascal & Vencatachellum, Desire, 2003. "Dynamic production teams with strategic behavior," Journal of Economic Dynamics and Control, Elsevier, vol. 27(5), pages 875-905, March.
    5. María Verónica Alderete, 2015. "Redes de pymes: una visión desde las teorías de club y de equipo," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 17(32), pages 317-348, January-J.
    6. Serhat Doğan & Kerim Keskin & Çağrı Sağlam, 2019. "Sabotage in team contests," Public Choice, Springer, vol. 180(3), pages 383-405, September.
    7. Benjamin Bental & Bruno Deffains & Dominique Demougin, 2020. "Interpreting contracts: the purposive approach and non-comprehensive incentive contracts," European Journal of Law and Economics, Springer, vol. 50(2), pages 241-265, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ier:iecrev:v:36:y:1995:i:4:p:1051-56. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley-Blackwell Digital Licensing or the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/deupaus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.