Universität Wien

040800 UK Theory of Incentives (2010W)

6.00 ECTS (3.00 SWS), SPL 4 - Wirtschaftswissenschaften
Continuous assessment of course work

There will be no class from October 24 to November 23, 2010.

Registration/Deregistration

Note: The time of your registration within the registration period has no effect on the allocation of places (no first come, first served).

Details

max. 50 participants
Language: English

Lecturers

Classes (iCal) - next class is marked with N

  • Wednesday 06.10. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 08.10. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 13.10. 12:00 - 14:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 20.10. 12:00 - 14:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 20.10. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 22.10. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 24.11. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 26.11. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 01.12. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 03.12. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 10.12. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 15.12. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 17.12. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 12.01. 16:00 - 20:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 14.01. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 19.01. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 21.01. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Wednesday 26.01. 16:00 - 18:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)
  • Friday 28.01. 13:00 - 15:00 (Seminarraum 1 Hohenstaufengasse 9 1.Stock)

Information

Aims, contents and method of the course

Standard microeconomic theory treats the firm as a "black box": it remains silent on how the owners of firms succeed in aligning the objectives of its various members (workers, supervisors, managers) with profit maximization. The Theory of Incentives (or Contract Theory) studies situations in which (i) the members of a firm have conflicting objectives, and (ii) information is decentralized (in the sense that the various agents hold private information not observable to others). Its insights are not limited to firms, but also extend to organizations in general, small markets, and any other environment of collective decision-making.

Assessment and permitted materials

Attendance is compulsory. If you miss class for more than three times, you will need a valid excuse. You will have to sit for 2 written exams and prepare a presentation of a research paper of your choice. Your final grade will be calculated as follows:
Mid-term Exam (30%), Student Presentation (30%), Final Exam (40%)

Minimum requirements and assessment criteria

The goal is to introduce students to the main issues and methods of modern contract theory. We will start with the so-called Principal-Agent Model, and study the three building blocks of contract theory: Adverse Selection, Moral Hazard, and Signaling. All issues will be illustrated with a number of real-world applications and examples.

Examination topics

The course has a standard lecture part and a hands-on exercises part where students are encouraged to apply the new concepts and techniques to a number of different problems. You will also have to prepare a presentation of a research paper studying the empirical relevance of the issues covered in the theory part of the class.

Reading list

Jean-Jacques Laffont and David Martimort: The Theory of Incentives: The Principal-Agent Model, Princeton University Press, 2002.
Patrick Bolton and Mathias Dewatripont: Contract Theory, Massachusetts Institute of Technology, 2005.

Association in the course directory

Last modified: Mo 07.09.2020 15:29