Pareto Gains from Limiting Compensation Options

Autor:	Pal Debashis, Sappington David E. M., Topolyan Iryna
Jazyk:	angličtina
Rok vydání:	2023
Předmět:	limited contract choice human capital investment d82 j41 k31 Economic growth development planning HD72-88 Labor. Work. Working class HD4801-8943
Zdroj:	IZA Journal of Labor Economics, Vol 12, Iss 1, Pp 601-637 (2023)
Druh dokumentu:	article
ISSN:	2193-8997
DOI:	10.2478/izajole-2023-0002
Popis:	We examine the effects of a single payment structure policy (SPP) that prevents an employer from offering an employee a choice among compensation structures. An SPP reduces the employer's profit and increases the employee's welfare when the employee's (privately known) ability is exogenous. In contrast, an SPP can increase both the employer's profit and the employee's welfare when the employee's ability is endogenous. An SPP secures these Pareto gains by restricting the employer's ability to limit the rent the employee earns from high ability, thereby inducing the employee to increase his human capital investment.
Databáze:	Directory of Open Access Journals
Externí odkaz:	https://doaj.org/article/031b1afd4b9043e086474d1769ac12c7 Zobrazit plný text záznamu View record in DOAJ Plný text ve formátu PDF Plný text ve formátu HTML
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