Implicit Contracts, Incentive Compatibility, and Involuntary Unemployment.
The theoretical foundations of efficiency wages are explored for a model with employees' performance unverifiable. The set of outcomes implementable by self-enforcing (perfect equilibrium) implicit bilateral contracts is characterized. Market equilibrium is then analyzed. Perfect equilibria exi...
| Main Authors: | , |
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| Format: | Journal article |
| Language: | English |
| Published: |
1989
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