Moral Hazard Contracts: Does One Size Fit All?

Alexander Koch and Eloic Peyrache (peyrache@hec.fr)
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Eloic Peyrache: HEC Paris

No 2463, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Incentive theory predicts that contract terms should respond to differences in agents’ productivities. Firms’ practice of anonymous contracts thus appears puzzling. We show that such a “one-size-fits-all” approach can be reconciled with standard agency theory if careers are marked by frequent transitions between employers, and agents have career concerns because complete long-term contracts are not feasible.

Keywords: career concerns; incentive contracts; reputation; anonymous contracts (search for similar items in EconPapers)
JEL-codes: D80 J33 L14 M12 (search for similar items in EconPapers)
Pages: 9 pages
Date: 2006-11
New Economics Papers: this item is included in nep-bec, nep-cfn and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published - published in: Economics Letters , 2008, 100 (3), 399-401.

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Related works:
Journal Article: Moral hazard contracts: Does one size fit all? (2008)
Working Paper: Moral hazard contracts: Does one size fit all? (2008)
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