Productive low morale

Rui Zhao

Economics Letters, 2009, vol. 103, issue 1, 18-22

Abstract: This paper models employment relationship as a repeated principal-agent problem with private evaluation. The efficient contracts exhibit correlated movements between lagged wage and current effort that are consistent with the positive feedback between pay and morale in practice. Low morale therefore is an integral part of a well-functioning relationship.

Keywords: Low; morale; Self-enforcing; contract; Private; evaluation; Principal-agent; Repeated; moral; hazard (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:103:y:2009:i:1:p:18-22

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