Question
In a principal-agent relationship the following for Penelope-Amanda: Participation Constraint (PC) e = 1 - P Incentive Compatibility Constraint (ICC) e = 1 - P
In a principal-agent relationship the following for Penelope-Amanda:
Participation Constraint (PC) e = 1 - P
Incentive Compatibility Constraint (ICC) e = 1 - P2
is the baseline disutility of work (Amanda's disutility of work for just showing up)
Due to the pandemic, the value of increased ( is the possibility of catching COVID at work)
If increases explain how it affects the Participation Constraint, the Incentive Compatibility Constraint, and profit with:
i. a complete contract
ii. an incomplete contract
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Survey Of Economics
Authors: Irvin B. Tucker
10th Edition
133711152X, 978-1337111522
