Strategic delegation and collusion: Do incentive schemes matter?
Jean-Daniel Guigou (),
Patrick de Lamirande () and
Bruno Lovat ()
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Jean-Daniel Guigou: Luxembourg School of Finance, University of Luxembourg
Bruno Lovat: University of Nancy
LSF Research Working Paper Series from Luxembourg School of Finance, University of Luxembourg
This paper introduces delegation decisions and contracts based on relative performance evaluation (RPE) in the analysis of cartel stability. We follow the approach developed by Lambertini and Trombetta , where manager's compensation combines pro_ts and sales (CPS) instead. Some of our results are similar while others are distinct from those of Lambertini and Trombetta. In particular, we show that collusion under RPE is always harder to sustain than under CPS.
Keywords: Cartel Stability; Delegation; Relative Performance Evaluation (search for similar items in EconPapers)
JEL-codes: D43 L13 L21 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:crf:wpaper:11-02
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