Incentive Compatible Contracts?

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BRUTTEL, Lisa, Gerald EISENKOPF, 2009. Incentive Compatible Contracts?

@techreport{Bruttel2009Incen-12271, series={Research paper series / Thurgauer Wirtschaftsinstitut}, title={Incentive Compatible Contracts?}, year={2009}, number={43}, author={Bruttel, Lisa and Eisenkopf, Gerald} }

Bruttel, Lisa 2011-03-25T09:43:56Z 2009 eng 2011-03-25T09:43:56Z application/pdf Property rights theory suggests that vertical integration is a sensible solution to hold-up problems and therefore improves social welfare.<br />Theories of reciprocity, in contrast, suggest that vertical integration can reduce social welfare if it implies an unfair distribution. Translating the hold-up situation into a simple prisoners dilemma game, we provide experimental evidence for social preferences at the individual level. Some individuals behave conditionally cooperative in the hold-up situation and some do not cooperate when they are offered an incentive compatible but unfair contract. Nevertheless, property rights theory correctly predicts that vertical integration increases aggregate welfare even in the case of unfair outcomes. terms-of-use Incentive Compatible Contracts? Eisenkopf, Gerald Bruttel, Lisa Eisenkopf, Gerald

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