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Motivating wealth-constrained actors

dc.contributor.author Lewis, TR
dc.contributor.author Sappington, DEM
dc.date.accessioned 2010-03-09T15:44:35Z
dc.date.issued 2000-09-01
dc.identifier.issn 0002-8282
dc.identifier.uri https://hdl.handle.net/10161/2097
dc.description.abstract We examine how owners of productive resources (e.g., public enterprises or financial capital) optimally allocate their resources among wealth-constrained operators of unknown ability. Optimal allocations exhibit: (1) shared enterprise profit - the resource owner always shares the operator's profit; (2) dispersed enterprise ownership -resources are widely distributed among operators of varying ability; (3) limited benefits of competition - the owner may not benefit from increased competition for the resource; and, sometimes, (4) diluted incentives for the most capable - more capable operators receive smaller shares of the returns they generate. Implications for privatizations and venture capital arrangements are explored. (JEL D82, D44, D20).
dc.format.mimetype application/pdf
dc.language.iso en_US
dc.publisher American Economic Association
dc.relation.ispartof American Economic Review
dc.title Motivating wealth-constrained actors
dc.type Journal article
duke.contributor.id Lewis, TR|0288071
pubs.begin-page 944
pubs.end-page 960
pubs.issue 4
pubs.organisational-group Duke
pubs.organisational-group Economics
pubs.organisational-group Fuqua School of Business
pubs.organisational-group Trinity College of Arts & Sciences
pubs.publication-status Published
pubs.volume 90


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