@techreport{Koch2004Mixed,
abstract = {An essential ingredient in models of career concerns is ex ante uncertainty about an agent's
type. This paper shows how career concerns can arise even in the absence of any such ex
ante uncertainty, if the unobservable actions that an agent takes influence his future
productivity. By implementing effort in mixed strategies the principal can endogenously
induce uncertainty about the agent's ex post productivity and generate reputational
incentives. Our main result is that creating such ambiguity can be optimal for the principal,
even though this exposes the agent to additional risk and reduces output. This finding
demonstrates the importance of mixed strategies in contracting environments with imperfect
commitment, which contrasts with standard agency models where implementing mixed
strategy actions typically is not optimal if pure strategies are also implementable.},
author = {Alexander K. Koch and Elo\"{\i}c Peyrache},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {M12; L14; J33; D80; 330; incentive contracts; reputation; mixed strategies; Anreizvertrag; Leistungsanreiz; Prestige; Karriereplanung; Asymmetrische Information; Agency Theory; Theorie},
language = {eng},
number = {1331},
title = {Mixed Up? : That's Good for Motivation},
type = {IZA Discussion paper series},
url = {http://hdl.handle.net/10419/20600},
year = {2004}
}
