Robust Regulation of Labour Contracts
We study the robust regulation of labour contracts in moral hazard problems. A firm offers a contract to incentivise a worker protected by limited liability. A regulator chooses the set of permissible contracts to (i) improve efficiency and (ii) protect the worker. The regulator does not know the worker's actions and the firm's costs and evaluates regulations by their worst-case regret. The regret-minimising regulation imposes a minimum piece rate compensation for the worker: it allows all contracts above a minimum linear contract. The slope of the minimum contract balances the worker's protection and the necessary flexibility for incentive provision.
Code (0)
등록된 구현이 없습니다.
Methods 이 논문이 사용한 방법론
Similar Papers 제목 키워드 기반
A general methodology to measure labour market dynamics
We propose a general methodology to measure labour market dynamics, inspired by the search and matching framework, based on the estimate of the transition rates between labour market states. We show how to estimate insta…
Optimal investment for participating insurance contracts under VaR-Regulation
This paper studies a Value-at-Risk (VaR)-regulated optimal portfolio problem of the equity holders of a participating life insurance contract. In a setting with unhedgeable mortality risk and complete financial market, t…
Towards Standardized Regulations for Block Chain Smart Contracts: Insights from Delphi and SWARA Analysis
The rise of digital currency and the public ledger Block Chain has led to the development of a new type of electronic contract known as "smart contracts." For these contracts to be considered valid, they must adhere to t…
Solving Financial Regulatory Compliance Using Software Contracts
Ensuring compliance with various laws and regulations is of utmost priority for financial institutions. Traditional methods in this area have been shown to be inefficient. Manual processing does not scale well. Automated…
Optimal Defaults, Limited Enforcement and the Regulation of Contracts
We study how governments promote social welfare through the design of contracting environments. We model the regulation of contracting as default delegation: the government chooses a delegation set of contract terms it i…