Теория контрактов и стимулы в организациях

Бакалавриат 2019/2020

Статус: Курс по выбору (Совместная программа по экономике НИУ ВШЭ и РЭШ)

Направление: 38.03.01. Экономика

Кто читает: Отдел сопровождения учебного процесса в Совместном бакалавриате ВШЭ-РЭШ

Где читается: Факультет экономических наук

Когда читается: 2-й курс, 3, 4 модуль

Формат изучения: без онлайн-курса

Язык: английский

Кредиты: 6

Контактные часы: 64

Full Syllabus

Abstract

The first part of this course provides an introduction to the Economics of Information. This field was a revolution in economics, overturning long standing presumptions, including the one of market efficiency. This had deep implications for economic policy. Economics of Information looks at situations where one of the contracting parties have private information. We will focus on settings with two parties: a principal (e.g. firm owner) and an agent (e.g. worker). The principal delegates a task to the agent who will obtain some private information as a result. This private information can be of two types: either the agent can take a hidden action (known as moral hazard); or the agent has some private knowledge (known as adverse selection). How should the principal cope with this situation? In the context of organizations, we will see how firm’s owners succeed in aligning the objectives of its various members, such as workers, supervisors, and managers, with profit maximization. The second part of the course revolves around the Economics of Organizations. Neoclassical economics traditionally viewed a firm as a production set. Given market prices, the firm chooses a set of inputs to buy, turns them into outputs, and then sells those outputs on the market in order to maximize profits. This "black box" view of the firm captures many important aspects of what a firm does, but leaves many questions unanswered: why do firms exist?, why some firms decide to buy inputs and others to make them?, what do managers do?, what is the role of hierarchy?, why do firms often appear dysfunctional?, why do inefficient and efficient firms coexist?, should we care about their coexistence? The purpose of this course is to move beyond the Neoclassical view of the firm and to provide you with a set of models that you can use as a first step when thinking about modern

Learning Objectives

The aim of this course is to move beyond the Neoclassical view of the firm and to provide students with a set of models that you can use as a first step when thinking about modern issues affecting private and public organizations.

Expected Learning Outcomes

Can participate in the development of options for management decisions, justifying their selection based on criteria of socio-economic efficiency, risks and possible socio-economic consequences of decisions
Understands models with a common principalagent framework

Course Contents

Adverse selection
Screening model with two types. Application to the seller-buyer, lender-borrower, employer-employee. Extensions: ex ante contracting, limited liability, different outside options. Case study: “Uber in Hong Kong: A regulator’s dilemma”, The University of Hong Kong
Moral hazard
Simple model with binary outcome and binary action. Linear Exponential Normal (LEN) model. Multitasking. Principles of compensation systems: informativeness, incentive-intensity, monitoring intensity, equal compensation. Short-termism and the financial crises. Case study: “Performance pay at Safelite Auto Glass (A and B)”, Harvard Business School
Informal incentives
Career concerns. Relational contracts. Case study: “The Lincoln Electric Company”, Harvard Business School
Management by incentives
Individual and team performance evaluation. Moral hazard in teams. Collusion in Hierarchies.Case study: “Pierre Frankel in Moscow (A): Unfreezing Change”, Harvard Business School
Delegation
Allocation of decision rights and obligations. Formal and real authority. Centralization and decentralization. Cheap talk. Case study: “The Alibaba Group”, Harvard Business School
Boundaries of the firm
Relationships with suppliers and distributors. Reasons for vertical integration: transactions costs, property rights, ownership incentives. Platforms. Killer acquisitions. Case study: “Finding the Platform in Your Product”, Harvard Business Review

Assessment Elements

Home assignments
Midterm
Final test
There will be online proctoring during the exam at ZOOM platform. The conference will be recorded. When suspicions of a violation of academic ethics arise, the administration reserves the right to review the video to decide if any action is necessary. Before the exam you need to prepare 2 devices. One device with the camera and ZOOM conference, and the second one you will use to make the test. Before entering the conference, install the device with the camera so that the camera captures you at the desk where you will be writing answers on paper, and the screen of the device from which you will be making the tasks. Common rules:  Upon entering ZOOM, please type your full name  Switch off notifications of all messengers and social networks on the device that will be used during the test. Pop-up notifications can be qualified as an attempt to communicate.  Switch on the microphone on the device used for ZOOM. Switch off all loud devices (TVs, alarm clocks etc.) and make sure there are no other noise sources in the room where you will be taking the exam.  Questions can be asked through the Google form, which will be send to you before the exam. If you have a question, raise your hand, and after the proctor’s permission you can type your question into the form. The proctor will inform you when you can see the answer. Questions and answers will be deleted after the student sees his/her answer Do not:  Use any materials except blank sheets of paper for your draft  Have outsiders in or out of the camera view  Communicate with other people, except the proctor  Leave the camera view during the exam  Switch off the camera and microphone during the exam  Have books or other documents on the desk, except for draft sheets and the final copy  Open any windows or screens on the device from which you are reading the task, except for the task itself and the Google form for questions to the proctor  Use headphones and smartwatch Proctor:  There will be a proctor in each virtual room  Before the exam you need to show to the proctor your room, desk, paper pads, and other materials, if any, that are allowed during the exam  The proctor may invite you to show your paper pad, the draft, or the screen of the device with the task at any time during the exam, calling you by the name via his/her microphone  You must open the task in my,nes only when the proctor instructs you to do so. After that you will have 60 minutes for the test.  The proctor will keep you informed of the remaining time. How to upload the test • After the proctor announces the end for the exam, click “SUBMIT FORM”. At this point it is not allowed to leave the ZOOM conference
Case studies

Interim Assessment

Interim assessment (3 module)
0.3 * Home assignments + 0.7 * Midterm
Interim assessment (4 module)
0.1 * Case studies + 0.4 * Final test + 0.25 * Home assignments + 0.25 * Midterm

Bibliography

Recommended Core Bibliography

Besanko, D. (2016). Economics of Strategy (Vol. 7th edition). Hoboken: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=1639494
Laffont, J.-J., & Martimort, D. (2002). The Theory of Incentives : The Principal-Agent Model. Princeton, N.J.: Princeton University Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=329691
Patrick Bolton, & Mathias Dewatripont. (2005). Contract Theory. The MIT Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.b.mtp.titles.0262025760

Recommended Additional Bibliography

Aghion, P., & Tirole, J. (1997). Formal and Real Authority in Organizations. https://doi.org/10.1086/262063
Andrei Markevich, & Ekaterina Zhuravskaya. (2011). M-form hierarchy with poorly-diversified divisions: A case of Khrushchev’s reform in Soviet Russia. Post-Print. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.p.hal.journl.halshs.00754499
Baker, G., Gibbons, R., & Murphy, K. J. (1994). Subjective Performance Measures in Optimal Incentive Contracts. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.F35CAF5D
Bengt Holmstrom, & Paul Milgrom. (1991). Multitask principal-agent analyses: incentive contracts, asset ownership, and job design. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.ADCF52CD
Dessein, W. (2002). Authority and Communication in Organizations. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.E0B18963
Garicano, L., & Rayo, L. (2015). Why organizations fail: models and cases. CEPR Discussion Papers. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.p.cpr.ceprdp.10395
George P. Baker, & Thomas N. Hubbard. (2004). Contractibility and Asset Ownership: On-Board Computers and Governance in U. S. Trucking. The Quarterly Journal of Economics, (4), 1443. https://doi.org/10.1162/0033553042476152
Grossman, S. J., & Hart, O. (1985). The Cost and Benefits of Ownership: A Theory of Vertical and Lateral Integration. CEPR Discussion Papers. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.p.cpr.ceprdp.70
Hart, O. D., & Moore, J. (1990). Property Rights and the Nature of the Firm. https://doi.org/10.1086/261729
Holmström, B. (1999). Managerial Incentive Problems: A Dynamic Perspective. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.90525380
Holmstrom, B., & Milgrom, P. (1994). The Firm as an Incentive System. American Economic Review, (4), 972. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.aea.aecrev.v84y1994i4p972.91
Macchiavello, R., & Morjaria, A. (2013). The Value of Relationships: Evidence from a Supply Shock to Kenyan Rose Exports. CEPR Discussion Papers. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.p.cpr.ceprdp.9531
Paul Glewwe, Nauman Ilias, & Michael Kremer. (2003). Teacher Incentives. NBER Working Papers. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.p.nbr.nberwo.9671
Paul Joskow. (1984). Vertical Integration and Long Term Contracts: The Case of Coal Burning Electric Generating Plants. Working Papers. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.p.mit.worpap.361
Silke Januszewski Forbes, & Mara Lederman. (2009). Adaptation and Vertical Integration in the Airline Industry. American Economic Review, (5), 1831. https://doi.org/10.1257/aer.99.5.1831
Tirole, J. (1986). Hierarchies and Bureaucracies: On the Role of Collusion in Organizations. Journal of Law, Economics, and Organization, (2), 181. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.oup.jleorg.v2y1986i2p181.214
Wouter Dessein, & Tano Santos. (2006). Adaptive Organizations. Journal of Political Economy, (5), 956. https://doi.org/10.1086/508031

Course Syllabus