Journalartikel

Autorenliste: Bannier, Christina E.; Feess, Eberhard; Packham, Natalie; Walzl, Markus

Jahr der Veröffentlichung: 2021

Seiten: 1-27

Zeitschrift: Journal of Institutional and Theoretical Economics

Bandnummer: 177

Heftnummer: 1

ISSN: 0932-4569

eISSN: 1614-0559

DOI Link: https://doi.org/10.1628/jite-2020-0044

Verlag: Mohr Siebeck

Abstract: 
We examine the effect of imperfect labor market competition on the efficiency of compensation schemes in a setting with moral hazard and risk-averse agents who have private information on their ability. Two heterogeneous firms compete for agents by offering contracts with fixed and variable payments. When competition is low, low-ability agents are underincentivized, exerting too little effort. When competition is high, high-ability agents are overincentivized and bear too much risk. For intermediate competition, contracts are second-best. An equilibrium where both firms are active exists only when the least-cost separating allocation is interim efficient.

Harvard-Zitierstil: Bannier, C., Feess, E., Packham, N. and Walzl, M. (2021) Differentiation and Risk Aversion in Imperfectly Competitive Labor Markets, Journal of Institutional and Theoretical Economics, 177(1), pp. 1-27. https://doi.org/10.1628/jite-2020-0044

APA-Zitierstil: Bannier, C., Feess, E., Packham, N., & Walzl, M. (2021). Differentiation and Risk Aversion in Imperfectly Competitive Labor Markets. Journal of Institutional and Theoretical Economics. 177(1), 1-27. https://doi.org/10.1628/jite-2020-0044