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Optimal Contracting with Endogenous Project Mission

Cassar, Lea ; Armouti-Hansen, Jesper



Abstract

Empirical evidence suggests that workers care about the mission of their job, in addition to their wage. This paper studies how organizations can choose a mission to attract, incentivize, and screen their workers. We analyze a model in which a principal offers a contract to an agent for the development of a project and can influence the agent's marginal return of effort through the choice of ...

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