Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/78421
Authors: 
Kräkel, Matthias
Year of Publication: 
2002
Series/Report no.: 
Bonn Econ Discussion Papers 3/2002
Abstract: 
This paper discusses the properties of stylized U.S. (U-type) and Japanese tournaments (J-type), which can both solve the unverifiability problem of labor contracts. Under a zero-profit condition, both tournament types will yield first-best efforts if workers are homogenous and risk neutral. This result will no longer hold for J-type tournaments if the employer has all the bargaining power. However, if workers are rik averse or one worker has a lead a J-type tournament may dominate a U-type tournament.
Subjects: 
Strategic Delegation
Mergers
Oligopoly
Contests
JEL: 
J31
J33
Document Type: 
Working Paper

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