Robust relational contracts with subjective performance evaluation

• 成果类型: Article
• 署名作者: Bhaskar, V.; Olszewski, Wojciech; Wiseman, Thomas
• 署名单位: University of Texas System; University of Texas Austin; Centre for Economic Policy Research - UK; Northwestern University
• 刊物名称: THEORETICAL ECONOMICS
• ISSN/ISSBN: 1933-6837
• DOI: 10.3982/TE5911
• 发表日期: 2024-07-01
• 页码: 1027-1055
• 关键词: Private monitoring; repeated games; RELATIONAL CONTRACTS; C73; D86

摘要

We study a repeated principal-agent model with transferable utility, where the principal's evaluation of the agent's performance is subjective. Our focus is on equilibria that are robust to the addition of small privately observed shocks to the payoffs. Existing constructions of positive-effort equilibria are not robust to such payoff shocks. Allowing for simultaneous cheap-talk announcements makes some effort sustainable in a robust equilibrium, and payoffs can be arbitrarily close to fully efficient ones if players are sufficiently patient. In contrast to the existing literature, our near-efficient equilibria exhibit realistic features: the bonus size is reasonable, the threshold for being paid a bonus is nontrivial, and the base wage need not be negative.