Abstract
AbstractOptimally reallocating human capital to tasks is key for an organization to successfully navigate a transition. We study how to design employment contracts to allocate employees to different valuable projects within an organization given two simultaneous challenges: The employees have private information about their cost of effort, and they exert unobservable effort. The optimal contract menu pairs a higher probability of assignment to a valuable project with a lower bonus in case of success. In limited cases, a fixed salary may be offered to employees with high effort cost. We link our results to job design features encountered in practice.
Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
