Should a principal hire one agent or two agents to perform two sequential tasks?

Patrick Schmitz

No 7976, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: A principal should hire one agent to perform two sequential tasks when the tasks are conflicting (i.e., a first-stage success makes second-stage effort less effective), while she should hire two different agents when the tasks are synergistic.

Keywords: Conflicting tasks; Moral hazard; Synergies (search for similar items in EconPapers)
JEL-codes: D86 (search for similar items in EconPapers)
Date: 2010-09
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