SMU SOE Seminar (September 1, 2022):Dynamic Contracting with Flexible Monitoring

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ABSTRACT We study a principal's joint design of optimal monitoring and com-pensation schemes to incentivize an agent by incorporating information design into a dynamic contracting framework. The principal can flexibly allocate her limited monitoring capacity between seeking evidence that confirms or contradicts the agent's effort, as the basis for reward or punishment. When the agent's continuation value is low, the principal seeks only confirmatory evidence. When it exceeds a threshold, the principal seeks mainly contradictory evidence. Importantly, the agent's effort is perpetuated if and only if he is sufficiently productive. JEL: D86 D82 G39 J33 M52 Click here to view the paper. Click here to view the CV.
		PRESENTER Ming Yang University College London
		RESEARCH FIELDS Finance Theory Economic Theory
		DATE: 1 September 2022 (Thursday)
		TIME: 4pm - 5.30pm
		VENUE: Meeting Room 5.1 School of Economics Level 5 Singapore Management University 90 Stamford Road Singapore 178903