Template-Type: ReDIF-Paper 1.0
Title: Optimal Incentive Contracts for Experts
Author-Name: Wolfgang R. Köhler
Author-Email: 
Classification-JEL: D23, D82, D83, J33
Keywords: Expertise, Forecasting, Incentives, Information Acquisition
Abstract: This paper analyzes optimal incentive contracts for information acquisition and revelation. A decision maker 
	faces the problem to design a contract that provides an expert with incentives to acquire and reveal information. 
	We show that it is in general not optimal to reward the expert if his recommendation is confirmed. The common 
	observation that experts are paid when their recommendation is confirmed can be explained by incomplete 
	information about the expert's cost to increase the precision of his information. We extend the model to analyze 
	contracting with multiple experts, the timing of expertise, and the provision of incentives when the realized state is 
	not verifiable
Note: 
Length: 35
Creation-Date: 2004-04	
Revision-Date: 
File-URL: http://www.wiwi.uni-bonn.de/bgsepapers/bonedp/bgse6_2004.pdf
File-Format: application/pdf
Handle: RePEc:bon:bonedp:bgse6_2004