Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict

In many countries governments are helpless to prevent appropriation, whatever the degree of protection promised by the law. In this context, we use a simple model where workers can either work peacefully or join a guerrilla movement that expropriates entrepreneurs. We find one low-income, low-wage e...

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Autores Principales: Andonova, V., Zuleta, H.
Formato: Artículo (Article)
Lenguaje:Inglés (English)
Publicado: 2020
Materias:
Acceso en línea:http://hdl.handle.net/1992/46794
id ir-1992-46794
recordtype dspace
spelling ir-1992-467942020-11-04T20:23:15Z Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict Andonova, V. Zuleta, H. Conflict Efficiency wages Income distribution Multiple equilibria In many countries governments are helpless to prevent appropriation, whatever the degree of protection promised by the law. In this context, we use a simple model where workers can either work peacefully or join a guerrilla movement that expropriates entrepreneurs. We find one low-income, low-wage equilibrium with guerrilla activity and one peaceful, high-income, high-wage equilibrium. We show that the peaceful equilibrium can be reached if entrepreneurs implement standard remedies for the internal principal-agent problem such as efficiency wages. 2020-10-01T16:42:31Z 2020-10-01T16:42:31Z 2009 article publishedVersion http://hdl.handle.net/1992/46794 http://www.degruyter.com/view/j/peps.2009.15.issue-1/peps.2009.15.1.1149/peps.2009.15.1.1149.xml eng openAccess application/pdf instname:Universidad de los Andes reponame:Repositorio Institucional Séneca
institution Universidad de los Andes
collection DSpace
language Inglés (English)
topic Conflict
Efficiency wages
Income distribution
Multiple equilibria
spellingShingle Conflict
Efficiency wages
Income distribution
Multiple equilibria
Andonova, V.
Zuleta, H.
Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict
description In many countries governments are helpless to prevent appropriation, whatever the degree of protection promised by the law. In this context, we use a simple model where workers can either work peacefully or join a guerrilla movement that expropriates entrepreneurs. We find one low-income, low-wage equilibrium with guerrilla activity and one peaceful, high-income, high-wage equilibrium. We show that the peaceful equilibrium can be reached if entrepreneurs implement standard remedies for the internal principal-agent problem such as efficiency wages.
format Artículo (Article)
author Andonova, V.
Zuleta, H.
author_facet Andonova, V.
Zuleta, H.
author_sort Andonova, V.
title Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict
title_short Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict
title_full Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict
title_fullStr Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict
title_full_unstemmed Beyond Moral Hazard: The Effect of Firm Level Compensation Strategies on Economic Conflict
title_sort beyond moral hazard: the effect of firm level compensation strategies on economic conflict
publishDate 2020
url http://hdl.handle.net/1992/46794
_version_ 1705934434499297280
score 12,131701