Can contracts solve the hold-up problem? Experimental evidence

• 成果类型: Article
• 署名作者: Hoppe, Eva I.; Schmitz, Patrick W.
• 署名单位: University of Cologne; Centre for Economic Policy Research - UK
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2010.12.002
• 发表日期: 2011
• 页码: 186-199
• 关键词: hold-up problem; option contracts; RENEGOTIATION; experiment

摘要

In the contract-theoretic literature, there is a vital debate about whether contracts can mitigate the hold-up problem, in particular when renegotiation cannot be prevented Ultimately, this question has to be answered empirically. As a first step, we have conducted a laboratory experiment with 960 participants. We consider investments that direction benefit the non-investing party. While according to standard theory, contracting would useless if renegotiation cannot be ruled out, we find that option contracts significant improve investment incentives compared to a no-contract treatment. This finding might be attributed to Hart and Moore's (2008) recent idea that contracts can serve as reference points. (C) 2010 Elsevier Inc. All rights reserved.