Fairness and incentives in a multi-task principal-agent model
Ernst Fehr and
Klaus Schmidt ()
Munich Reprints in Economics from University of Munich, Department of Economics
Abstract:
This paper reports on a two-task principal agent experiment in which only one task is contractible. The principal can either offer a piece-rate contract or a (voluntary) bonus to the agent. Bonus contracts strongly outperform piece-rate contracts. Many principals reward high effort on both tasks with substantial bonuses. Agents anticipate this and provide high effort on both tasks, in contrast, almost all agents with a piece-rate contract focus on the first task and disregard the second. Principals understand this and predominantly offer bonus contracts. This behavior contradicts the self-interest theory but is consistent with theories of fairness.
Date: 2004
References: Add references at CitEc
Citations: View citations in EconPapers (97)
Published in Scandinavian Journal of Economics 3 106(2004): pp. 453-474
There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.
Related works:
Journal Article: Fairness and Incentives in a Multi‐task Principal–Agent Model (2004)
Working Paper: Fairness and Incentives in a Multi-Task Principle-Agent Model (2004)
Working Paper: Fairness and Incentives in a Multi-Task Principal-Agent Model (2004)
Working Paper: Fairness and Incentives in a Multi-Task Principal-Agent Model
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:lmu:muenar:20657
Access Statistics for this paper
More papers in Munich Reprints in Economics from University of Munich, Department of Economics Ludwigstr. 28, 80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Tamilla Benkelberg ().