Cahiers du CEREMADE

Unité Mixte de Recherche du C.N.R.S. N°7534
 
Abstract : We study incentive-compatible labor contracts in the case where both individual productivity q and subjective discount rate d are unobservable by the firm. We first show that unidimensional manifolds of agents group on the same contract. High q, low d agents may choose the same contract as low q, high d agents. We show existence and uniqueness of an optimal wage function which is continuous and unbounded. This optimal wage function can be determined by the ironing procedure.
 
 
LABOR CONTRACTS WITH TWO-DIMENSIONAL ADVERSE SELECTION
CARLIER Guillaume, GAUMONT D.
2000-22
30-05-2000
 
Université de PARIS - DAUPHINE
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