Browsing by Subject "principal agent problems"

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A Note on Moral Hazard and Linear Compensation Schemes

Wang, XY (Economic Research Initiatives at Duke (ERID) Working Paper, 2013-07-18)

This note identifies a moral hazard environment in which a piecewise linear compensation scheme is optimal. Both the principal and the agent have CARA utility, mean output is increasing in the agent's non-contractible input, ...