Anmerkungen:
Literaturverz. S. 19 - 20
Auch im Internet unter der Adresse ftp://129.187.96.124/CESifo_WP/406.pdf verfügbar
Beschreibung:
When politicians have lower discount factors than voters, democratic elections cannot sufficiently motivate politicians to undertake long-term socially beneficial projects. When politicians can offer incentive contracts which become effective upon reelection, the hierarchy of contracts and elections can alleviate such inefficient decision-making in politics. This mechanism still works if the public cannot commit itself to a reelection scheme or if the public is unsure about the politicians' time preferences. In the non-commitment case, incentive contracts may need to include a golden parachute clause.