The ratchet effect: A learning perspective

• 成果类型: Article
• 署名作者: Bhaskar, V; Roketskiy, Nikita
• 署名单位: University of Texas System; University of Texas Austin; Centre for Economic Policy Research - UK; University of London; University College London
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2023.105762
• 发表日期: 2023
• 关键词: Ratchet effect; moral hazard; learning; Randomized effort

摘要

We examine the ratchet effect under moral hazard and symmetric learning by worker and firm about new technology. Shirking increases the worker's future payoffs, since the firm overestimates job difficulty. Highpowered incentives to deter shirking induce the agent to over-work, since he can quit if the firm thinks the job is too easy. With continuous effort choices, no deterministic interior effort is implementable. We provide conditions under which randomized effort is implementable, so that a profit-maximizing distribution over efforts exists. (c) 2023 Elsevier Inc. All rights reserved.