Team Incentives in Relational Employment Contracts

A-Tier
Journal: Journal of Labor Economics
Year: 2006
Volume: 24
Issue: 1
Pages: 139-170

Authors (2)

Ola Kvaløy (not in RePEc) Trond E. Olsen (Norges Handelshøyskole (NHH))

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

The article analyzes conditions for implementing incentive schemes based on, respectively, joint, relative, and independent performance in a relational contract between a principal and a team of two interacting agents. A main result is that the optimal incentive regime depends crucially on the productivity of the agents. This occurs because agents' productivities affect the principal's temptation to renege on the relational contract. The analysis suggests that we will see a higher frequency of relative performance evaluationand schemes that lie close to independent performance evaluationas we move from low-productive to high-productive environments.

Technical Details

RePEc Handle
repec:ucp:jlabec:v:24:y:2006:i:1:p:139-170
Journal Field
Labor
Author Count
2
Added to Database
2026-01-25