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dc.contributor.authorAdithipyangkul, Pattarin
dc.date.accessioned2017-06-23T03:00:45Z
dc.date.available2017-06-23T03:00:45Z
dc.date.created2017-06-19T03:39:27Z
dc.date.issued2016
dc.identifier.citationAdithipyangkul, P. 2016. The use of non-verifialble information regarding the agent's action in compensation contracts. Theoretical Economics Letters. 6 (2): pp. 234-245.
dc.identifier.urihttp://hdl.handle.net/20.500.11937/53650
dc.identifier.doi10.4236/tel.2016.62026
dc.description.abstract

Subjective, non-verifiable information (such as satisfaction rating) is often used to supplement objective, verifiable information (such as financial numbers) in contracting. Empirical research finds that non-verifiable information can be used in contracting as a subjective performance measure or as subjective weighting on an objective performance measure. The differences between the two options have not yet been thoroughly explored analytically. This paper considers a multi-task setting where the non-verifiable performance signal provides incremental information about an aspect of the agent’s action. The research finds that when the agent has unlimited liability, both contracting schemes deliver the same payoff to the principal. However, the principal may strictly prefer a subjective weighting scheme in a setting where the agent has limited liability.

dc.publisherScientific Research Publishing
dc.rights.urihttp://creativecommons.org/licenses/by/4.0/
dc.titleThe use of non-verifialble information regarding the agent's action in compensation contracts
dc.typeJournal Article
dcterms.source.volume6
dcterms.source.startPage234
dcterms.source.endPage245
dcterms.source.issn2162-2078
dcterms.source.titleTheoretical Economics Letters
curtin.accessStatusOpen access


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