Equilibrium incentive contracts and efficiency wages

• 成果类型: Article
• 署名作者: Moen, Espen R.; Rosen, Asa
• 署名单位: BI Norwegian Business School; Stockholm University
• 刊物名称: JOURNAL OF THE EUROPEAN ECONOMIC ASSOCIATION
• ISSN/ISSBN: 1542-4766
• DOI: 10.1162/JEEA.2006.4.6.1165
• 发表日期: 2006
• 页码: 1165-1192
• 关键词: involuntary unemployment; asymmetric information; performance pay; DYNAMICS; workers; income; firm

摘要

We analyze the optimal (efficiency) wage contract when output is contractible but firms neither observe the workers' effort nor their match-specific productivity. Firms offer wage contracts that optimally trade off effort and wage costs. As a result, employed workers enjoy rents, which in turn creates unemployment. Nonetheless, the incentive power of the equilibrium wage contract is constrained efficient in the absence of taxes and unemployment benefits. We also show that more high-powered incentive contracts tend to be associated with higher equilibrium unemployment rates.