POSITIVE SELF‐IMAGE IN TOURNAMENTS*

This article analyzes the implications of worker overestimation of productivity for firms in which incentives take the form of tournaments. Each worker overestimates his productivity but is aware of the bias in his opponent's self‐assessment. The manager of the firm, on the other hand, correctly assesses workers' productivities and self‐beliefs when setting tournament prizes. The article shows that, under a variety of circumstances, firms can benefit from worker positive self‐image. The article also shows that worker positive self‐image can improve welfare in tournaments. In contrast, workers' utility declines due to their own misguided choices.     

Technology adoption under hidden information

We consider a firm where workers have pre-contractual private information regarding their cost of production. Before contracting takes place, the owner of the firm can adopt a new technology that reduces production costs for each type of worker. We show that technology adoption may have an adverse rent effect that counteracts the cost-reducing effect. This is the case whenever the new technology reduces the costs of more efficient types more strongly. Nevertheless, if the owner contracts directly with a worker (two-tier hierarchy), the cost-reducing effect always dominates. By contrast, if the firm has more hierarchical tiers such that contracting with the worker is delegated to a manager, the rent effect may prevail. Then, the owner does not adopt the new technology, even if it is costlessly available.     

Intrinsic and Extrinsic Motivation

A central tenet of economics is that individuals respond to incentives. For psychologists and sociologists, in contrast, rewards and punishments are often counterproductive, because they undermine "intrinsic motivation". We reconcile these two views, showing how performance incentives offered by an informed principal (manager, teacher, parent) can adversely impact an agent's (worker, child) perception of the task, or of his own abilities. Incentives are then only weak reinforcers in the short run, and negative reinforcers in the long run. We also study the effects of empowerment, help and excuses on motivation, as well as situations of ego bashing reflecting a battle for dominance within a relationship.     

Non-commitment in performance evaluation and the problem of information distortions

Auditing is modeled in a sequential game without commitment. The manager must decide whether and where to audit a worker's output, taking into account all interim information he has obtained. The worker will work just hard enough (and show it) to divert the manager from making an audit or cover up, withholding information about his work to make an audit more difficult. This usually raises the costs of setting work incentives, so incentives are softened, sometimes drastically. Moreover, when a worker's on-the-job information is valuable for entrepreneurial decisions, work incentives must be softened to improve the internal flow of information.     

Collective Action,Marx’s Class Theory,and the Union Movement

Research on establishment size-wage effects has consistently shown a positive relationship between the number of employees and workers' wages. While several theories have been offered to explain these outcomes, the use of data with limited employer characteristics make for a dubious connection between theory and results. This study examines the firm size-wage effect using a dataset that captures typical worker demographics, but also contains employer information not typically captured in larger datasets. The results provide strong evidence that these wage effects are the result of several forces, including worker sorting/matching, efficiency wages, internal labor markets, and, to a lesser degree, working conditions.     

管理者交易的市场择时能力对市场流动性的影响

利用国泰安数据服务中心数据,采用事件研究法,考察中国上市公司中管理者买入交易和卖出交易对我国股票市场流动性的影响,结果显示:管理者买入后的市场流动性减弱,归因于管理者与其他市场参与者之间的信息不对称;管理者卖出降低管理者的股权,提高市场流动性,信息不对称减弱。管理者在市场交易比较活跃的日期交易,可能是因为在高的市场交易量下能隐藏管理者的私人信息。     

Endogenous information quality: A job-assignment application

This paper investigates the optimal acquisition of information in a model of job assignment within a firm. We consider a firm with two types of jobs, skilled and unskilled. The firm draws workers randomly from the general population, and a worker is either talented or untalented. Initially, a worker's productivity in the firm is unknown to the worker and the firm. Workers are equally productive in the unskilled job, but talented workers are more productive in the skilled job than in the unskilled job, and untalented workers are more productive in the unskilled job than in the skilled job. Before assigning a worker to a job, the firm can test whether the employee is talented, and the firm is able to choose the accuracy of this test. We assume that the cost of a test is increasing and convex in test accuracy. We show that (1) the accuracy of the firm's test increases with the cost of a mismatched worker; (2) increased optimism about the worker's ability need not lead to less rigorous testing; (3) the probability that a worker is assigned to the skilled job need not increase as the gain from assigning a talented worker to a skilled job increases, or the loss from assigning an untalented worker to a skilled job decreases, or the fraction of the population that is skilled increases; and (4) a longer testing period, allowing as many as two tests of workers, leads the firm to use a less expensive, and less accurate, test initially than when there is only one opportunity to gather information.     

Enterprise performance and ownership: The case of Ukraine

In this paper, we use a unique enterprise level random survey of 150 firms in Ukraine to test hypotheses on the relationship between enterprise performance and ownership in transitional economies. In particular, we explore whether privatisation has yielded improved company performance and whether specific ownership forms (insider, manager, worker, and outsider) have led to differentiated behaviour at the enterprise level. Our analysis also explores the determinants and ramifications of barter, a widespread phenomenon across the former Soviet Union. We refute the hypothesis that private ownership per se is associated with improved performance, and try to isolate any positive performance effects from outsider ownership. However, we do isolate some clear ownership effects, associated with insider ownership. We find barter to be associated with lower profitability, and to be less common in privatised firms.     

Wage and Technology Dispersion

This paper explains why firms with identical opportunities may use different technologies and offer different wages. Our key assumption is that workers must engage in costly search in order to gather information about jobs (Stigler (1961)). In equilibrium, some firms adopt high fixed cost, high productivity technologies, offer high wages, and fill job openings quickly. Other firms adopt less capital-intensive technologies and offer low wages, hiring mostly uninformed workers. In equilibrium, the amount of wage dispersion leaves workers indifferent about whether to gather information, and the fraction of informed workers leaves firms indifferent about their wage and technology choice. We show that worker search, which would appear to be a rent-seeking activity in partial equilibrium, may be efficiency-enhancing in general equilibrium.     

利率管制松绑、企业会计信息披露质量与融资约束

已有研究发现,以资本价格——利率为代表的要素市场改革会对企业行为产生重要影响,但这种影响的作用机理如何通过改变资本市场中的信息供求关系予以实现,亟待深入研究。为此,本文以我国2013年央行全面放开利率管制为背景,基于产权性质差异构建双重差分模型,检验利率管制松绑在企业层面的信息溢出效应。研究发现:央行全面放开利率管制不仅有助于促进企业披露高质量的会计信息,还能够缓解企业的融资约束,且企业信息披露质量的提升是导致利率管制松绑降低融资约束的重要渠道。进一步研究发现,对于市场化程度较低地区、R&D投入较高以及短期贷款占比较大的公司,上述信息溢出效应更加显著;另外,利率管制松绑后企业披露高质量的会计信息能够增进投资者的信任,提高信息披露的价值相关性。以上研究结论表明,为应对利率市场化改革带来的机遇与挑战,保障可持续发展,企业会选择主动优化信息环境,来消除信贷市场摩擦,解决“融资难”问题。     

Remote viewing as applied to futures studies

Remote viewing is set of related protocols that allow a viewer to intuitively gather information regarding a specific target that is hidden from physical view and separated from the viewer by either time or distance. Research suggests that the same processes used to gather spatially non-local information can also be used to gather information that is temporally removed from the observer. This paper reviews the most common protocols for remote viewing — including Coordinate Remote Viewing (CRV), Associative Remote Viewing (ARV), and Extended Remote Viewing (ERV).¹This remains a controversial field of study. While over 30 years of data has been gathered with statistically significant results frequently occurring under laboratory conditions, skeptics are not convinced that RV is a useful pursuit. In addition to this, some of the output from RV can be vague and subject to personal interpretation.A number of factors have been shown to improve the success rate for remote viewing, including the use of experienced subjects, individual testing, feedback of results, and a short time-interval between the percipient response and the targeted future event. Finally, there also appears to be a relationship between the effectiveness of remote viewing efforts and sidereal time, which may be interpreted as evidence that some aspects of RV are subject to the same physical laws as are other phenomena studied by science.Remote viewing and related processes merit further exploration and study. While remote viewing may never be completely understood, it has the potential to make a meaningful contribution to the professional futurist′s toolbox.     

Inefficient Investment,Information Asymmetry,and Competition for Managers

We investigate the possible inefficiency of investment when the manager has better information than the principal. We assume that projects can be grouped into two categories based on their information characteristics of soft and hard information. We consider a case in which the manager faces competition for appointment at the end of term. We consider several cases in which the competitor's ability is known, or proxied by the performance of other managers, or is uncertain. We find that hard information projects are preferred to soft information projects and that the efficiency in project selection critically depends on the competitor's ability. Interestingly, information asymmetry may be socially beneficial, because it can provide the manager with incentives to select high‐quality hard‐information projects. Welfare improvement can be made by a budget change that is in the opposite direction to the optimum. Several empirical implications of the theory are discussed.     

Informational lobbying and political contributions

Interest groups can potentially influence political decision-makers by offering contributions and by providing relevant information that sways the decision in the group's favor. What mix of these two instruments should an interest group choose, and how does the use of one instrument affect the effectiveness of the other? In this paper we identify an information externality that raises the cost of offering contributions and show that this indirect search cost reduces the group's incentive to gather information when contributions are allowed. Furthermore, we analyze how competition among lobby groups as providers of information and contributions affect the choice and effectiveness of the instruments. We show that the information externality rewards the group that can abstain from information search and focus its influence on contributions.     

Incentive contracts in delegated portfolio management under VaR constraint

This paper studies the incentive effect of linear performance-adjusted contracts in delegated portfolio management under a value-at-risk (VaR) constraint. It is shown that a linear performance-based contract can provide incentives for the portfolio manager to work at acquiring private information under a VaR risk constraint. The expected utility and optimal effort of a risk-averse manager are increasing functions of the return sharing ratio in the contract. However, a risk constraint causes the portfolio manager to reduce effort in gathering private information, suggesting that the VaR constraint increases the moral hazard between the investor and the manager.     

Modelling countervailing incentives in adverse selection models: A synthesis

This paper is concerned with countervailing incentives in the adverse selection problems that typically arise in principal-agent relationships when the agent has private information. These incentives are present when the agent is tempted to either overstate or understate his private information depending upon the specific realization of his type. These problems were first analyzed by Lewis and Sappington (1989) and have been characterized and extended by Maggi and Rodríguez-Clare (1995a) and Jullien (2000). In this paper we propose a simple method of characterizing countervailing incentives in which the key element is the analysis of the properties of the full information problem. Our method for solving the principal problem, once identified the presence of countervailing incentives, follows closely the Baron’s (1989) approach, which does not require using optimal control theory. The methodology we present can be easily applied to many different economic settings. For example, in health economics, an insurer (or a hospital manager) might act as a principal and a physician as an agent. In labor settings, an employer may play the role of principal and a worker may act as the agent. In regulated industries, the regulatory agency might act as a principal designing incentive schemes for firms (the agents). In environmental regulation or resource exploitation, the principal might be an international agency dealing with national governments or firms.     

对几种典型企业组织的规模差异评析

基于从本质到现象的分析路线,我们可以更清楚地认识企业规模：社会合理规模与企业的有效性相对应,取决于企业的组织成本和协调收益;而企业的现实规模则与特定个体的效率相对应,效率不仅取决于协调收益也与转移收益有关。一般地,企业的决策权为不同人所掌握,就会产生不同的收益转移效应,从而产生了多姿多彩的企业形态：（1）不同社会文化伦理中的收益转移效应差异会影响企业规模。一般地,社会信任度越高,企业规模就越合理;而信任度不高的那些社会中,企业规模往往走向两个极端。（2）不同的分配制度中的收益转移效应差异也会影响企业规模。利润分享制企业的剩余索取权往往为所有员工所分享,从而其规模往往小于泰勒制企业。（3）在工人自治型企业中,由于工人主导了剩余索取权的分配,从而使得企业的规模相对较小。（4）中央计划体制下国有企业是极端化的经理管理型企业,经理们所追求的社会收益与企业规模联系在一起,因而这类企业的规模较大。     

Learning to update your reservation wage while looking for a new job

We combine post-displacement survey data with information from personnel files of a displacing firm in order to reveal sources of worker heterogeneity in search time and wage losses. The Fokker Personnel Files and Survey are described in detail. We develop a dynamic reservation wage with updating. The method of updating is based on the simple idea that job seekers are informed about successful matches of their former colleagues similar to them. The data offer empirical support for the updating model.     

ACQUISITION OF INFORMATION TO DIVERSIFY CONTRACTUAL RISK*

Are hedging transactions that diversify a manager’s compensation risk detrimental to incentives, or can they improve contracting efficiency? If hedging provides efficiency benefits, should the manager or the firm undertake it? In our model, both the firm and the manager can trade financial portfolios to diversify the manager’s compensation risk. Prior to the portfolio selection, the parties need to acquire information on how different financial portfolios fit their diversification purposes. We illustrate that financial portfolios correlated with firm‐specific risk improve contracting efficiency. For equal information costs, it is optimal for the firm to undertake the hedging on the manager’s behalf.     

Minimum wages and youth unemployment

This paper constructs a labor search model to explore the effects of minimum wages on youth unemployment. To capture the gradual decline in unemployment for young workers as they age, the standard search model is extended so that workers gain experience when employed. Experienced workers have higher average productivity and lower job finding and separation rates that match wage and worker flow data. In this environment, minimum wages can have large effects on unemployment because they interact with a worker's ability to gain job experience. The increase in minimum wages between 2007 and 2009 can account for a 0.8 percentage point increase in the steady state unemployment rate and a 2.8 percentage point increase in unemployment for 15–24 year old workers in the model parameterized to simulate outcomes of high school educated workers. Minimum wages can also help explain the high rates of youth unemployment in France compared to the United States.     

Corporate tax evasion with agency costs

This paper examines corporate tax evasion in the context of the contractual relationship between the shareholders of a firm and a tax manager who possesses private information regarding the extent of legally permissible reductions in taxable income, and who may also undertake illegal tax evasion. Using a costly state falsification framework, we characterize formally the optimal incentive compensation contract for the tax manager and, in particular, how the form of that contract changes in response to alternative enforcement policies imposed by the taxing authority. The optimal contract may adjust to offset, at least partially, the effect of sanctions against illegal evasion, and we find a new and policy-relevant non-equivalence result: penalties imposed on the tax manager are more effective in reducing evasion than are those imposed on shareholders.