Thiele, Veikko (2007): Task-Specific Abilities in Multi-Task Agency Relations.
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This paper analyzes a multi-task agency framework where the agent exhibits task-specific abilities. It illustrates how incentive contracts account for the agent's task-specific abilities if contractible performance measures do not reflect the agent's contribution to firm value. This paper further sheds light on potential ranking criteria for performance measures in multi-task agencies. It demonstrates that the value of performance measures in multi-task agencies cannot necessarily be compared by their respective signal/noise ratios as in single-task agency relations. It is rather pivotal to take the induced effort distortion and measure-cost efficiency into consideration -- both determined by the agent's task specific abilities.
|Item Type:||MPRA Paper|
|Institution:||University of British Columbia|
|Original Title:||Task-Specific Abilities in Multi-Task Agency Relations|
|Keywords:||Task-specific human capital; performance measurement; distortion; multi-task agencies; congruence; incentives|
|Subjects:||D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information; Mechanism Design
J - Labor and Demographic Economics > J2 - Demand and Supply of Labor > J24 - Human Capital; Skills; Occupational Choice; Labor Productivity
|Depositing User:||Veikko Thiele|
|Date Deposited:||01. Mar 2008 07:02|
|Last Modified:||20. Feb 2013 15:35|
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Task-Specific Abilities in Multi-Task Agency Relations. (deposited 01. Apr 2007)
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