Chapter 8. Imperfect Contracting in Labor Exchange

  1. Joyce P. Jacobsen and
  2. Gilbert L. Skillman

Published Online: 14 JAN 2008

DOI: 10.1002/9780470755587.ch9

Labor Markets and Employment Relationships: A Comprehensive Approach

Labor Markets and Employment Relationships: A Comprehensive Approach

How to Cite

Jacobsen, J. P. and Skillman, G. L. (eds) (2008) Imperfect Contracting in Labor Exchange, in Labor Markets and Employment Relationships: A Comprehensive Approach, Blackwell Publishing Ltd, Malden, MA, USA. doi: 10.1002/9780470755587.ch9

Publication History

  1. Published Online: 14 JAN 2008
  2. Published Print: 1 JAN 2004

ISBN Information

Print ISBN: 9780631208365

Online ISBN: 9780470755587

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Keywords:

  • labor exchange;
  • labor contracts;
  • moral hazard;
  • incomplete contracts;
  • renegotiation

Summary

This chapter contains section titled:

  • TRANSACTION COSTS AND CONTRACTUAL FAILURES

  • Specification, verification, and incomplete labor contracts

  • Observability and asymmetric information

  • LABOR EXCHANGE UNDER INCOMPLETE CONTRACTS The basic setting

  • Asset specificity and quasi-rents

  • Renegotiation and the “holdup” problem

  • LABOR EXCHANGE UNDER ASYMMETRIC INFORMATION

  • Adverse selection and moral hazard

  • Labor exchange with unobservable effort: a reference case

  • Worker risk aversion and insurance-incentive tradeoffs

  • Hidden effort plus hidden productivity

  • CONCLUSION

  • THE PROBLEM OF HIDDEN EFFORT Reference case

  • Hidden effort with stochastic output and risk-averse worker