Incentive Effects of Funding Contracts : An Experiment

Cite This

Files in this item

Checksum: MD5:290a660d8fd3e7d22ae4704e3e15b13e

REISS, J. Philipp, Irenaeus WOLFF, 2012. Incentive Effects of Funding Contracts : An Experiment

@techreport{Rei2012Incen-30232, series={Working Paper Series / Department of Economics}, title={Incentive Effects of Funding Contracts : An Experiment}, year={2012}, number={2012‐26}, author={Reiß, J. Philipp and Wolff, Irenaeus}, note={Auf dem PDF steht die Bandnummer "2012-27", es ist aber "2012-26".} }

<rdf:RDF xmlns:dcterms="" xmlns:dc="" xmlns:rdf="" xmlns:bibo="" xmlns:dspace="" xmlns:foaf="" xmlns:void="" xmlns:xsd="" > <rdf:Description rdf:about=""> <dc:contributor>Reiß, J. Philipp</dc:contributor> <dc:creator>Reiß, J. Philipp</dc:creator> <dc:rights>terms-of-use</dc:rights> <dc:date rdf:datatype="">2015-03-12T10:46:27Z</dc:date> <bibo:uri rdf:resource=""/> <dcterms:hasPart rdf:resource=""/> <dcterms:title>Incentive Effects of Funding Contracts : An Experiment</dcterms:title> <dcterms:isPartOf rdf:resource=""/> <dcterms:available rdf:datatype="">2015-03-12T10:46:27Z</dcterms:available> <dc:contributor>Wolff, Irenaeus</dc:contributor> <dcterms:abstract xml:lang="eng">We examine the incentive effects of funding contracts on entrepreneurial effort decisions and allocative efficiency. We experiment with funding contracts that differ in the structure of investor repayment and, therefore, in the incentives for entrepreneurial effort provision. Theoretically the replacement of a standard debt contract by a repayment-equivalent non-monotonic contract reduces effort distortions and increases efficiency. Likewise the replacement of outside equity by a repayment-equivalent standard-debt contract mitigates distortions. We test both hypotheses in the laboratory. Our results reveal that the incentive effects of funding contracts need to be experienced before they reflect in observed behavior. With sufficient experience observed behavior is consistent with the theoretical predictions and supports both hypotheses. If we allow for entrepreneur-sided manipulations of the project outcome we find that non-monotonic contracts lose its appeal.</dcterms:abstract> <dc:creator>Wolff, Irenaeus</dc:creator> <dcterms:issued>2012</dcterms:issued> <void:sparqlEndpoint rdf:resource="http://localhost/fuseki/dspace/sparql"/> <dcterms:rights rdf:resource=""/> <dc:language>eng</dc:language> <dspace:isPartOfCollection rdf:resource=""/> <foaf:homepage rdf:resource="http://localhost:8080/jspui"/> <dspace:hasBitstream rdf:resource=""/> </rdf:Description> </rdf:RDF>

Downloads since Mar 12, 2015 (Information about access statistics)

Reiss_0-274578.pdf 326

This item appears in the following Collection(s)

Search KOPS


My Account