Contract Incentives and Effort

Peter Chinloy () and Daniel T. Winkler ()
Additional contact information
Peter Chinloy: American University
Daniel T. Winkler: University of North Carolina at Greensboro

Journal of Real Estate Research, 2010, vol. 32, issue 4, 397-412

Abstract: In a prevailing employment contract, the agent receives a proportional split of commissions. Alternatively, the agent receives a contract paying 100% of revenue above a fixed payment to the firm. In this contract the firm has a prior payment position, similar to a landlord or lender. The coexistence of these equity-only and debt-equity type contracts allows testing incentives for productivity and effort for U.S. real estate licensees. Hourly wages and productivity are increasing in the agent's split, up to and including 100%. Effort as measured by hours worked also positively affected by the split. The contract incentives motivate productivity and induce effort without requiring monitoring.

JEL-codes: L85 (search for similar items in EconPapers)
Date: 2010
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://pages.jh.edu/jrer/papers/pdf/past/vol32n04/02.397_412.pdf Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jre:issued:v:32:n:4:2010:p:397-412

Ordering information: This journal article can be ordered from
Diane Quarles American Real Estate Society Manager of Member Services Clemson University Box 341323 Clemson, SC 29634-1323
http://pages.jh.edu/jrer/about/get.htm

Access Statistics for this article

Journal of Real Estate Research is currently edited by Dr. Ko Wang

More articles in Journal of Real Estate Research from American Real Estate Society American Real Estate Society Clemson University School of Business & Behavioral Science Department of Finance 401 Sirrine Hall Clemson, SC 29634-1323.
Bibliographic data for series maintained by JRER Graduate Assistant/Webmaster ().