TY -
GEN
AU - Kragl, Jenny
AU - Schmid, Julia
TI -
The Impact of Envy on Relational Employment Contracts
KW - Principal-agent
KW - Relational contract
KW - Inequity aversion
KW - Envy
PY - 2009
N2 - Postprint
N2 - begutachtet (peer reviewed)
N2 - In: Journal of Economic Behavior & Organization ; 72 (2009) 2 ; 766-779
N2 - We study the effects of envy on relational employment contracts in a standard moral hazard setup with two agents. Performance is evaluated via an observable, but non-contractible signal which reects an agent's individual contribution to firm value. Both agents exhibit horizontal disadvantageous inequity aversion. In contrast to the literature, we find that inequity aversion may be beneficial; in the presence of envy, for a certain range of interest rates, relational contracts may be more profitable. For some interest rates reputational equilibria exist only with envious agents.
UR - http://slubdd.de/katalog?TN_libero_mab2
ER -