Please use this identifier to cite or link to this item: https://hdl.handle.net/20.500.11851/1740
Title: The Optimality of Team Contracts
Authors: Barlo, Mehmet
Özdoğan, Atabay Ayça
182115
Keywords: Principal-agent problems
Linear contracts
Collusion
Team
Decentralization
Issue Date: Nov-2013
Publisher: MDPI
Source: Barlo, M., & Özdoğan, A. (2013). The optimality of team contracts. Games, 4(4), 670-689.
Abstract: This paper analyzes optimal contracts in a linear hidden-action model with normally distributed returns possessing two moments that are governed jointly by two agents who have negative exponential utilities. They can observe and verify each others’ effort levels and draft enforceable side-contracts on effort levels and realized returns. Standard constraints, resulting in incentive contracts, fail to ensure implementability, and we examine centralized collusion-proof contracts and decentralized team contracts, as well. We prove that the principal may restrict attention to team contracts whenever returns from the project satisfy a mild monotonicity condition.
URI: https://doi.org/10.3390/g4040670
https://hdl.handle.net/20.500.11851/1740
ISSN: 2073-4336
Appears in Collections:İktisat Bölümü / Department of Economics
Scopus İndeksli Yayınlar Koleksiyonu / Scopus Indexed Publications Collection

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