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labour contracts

European Business Organization Law Review (EBOR) (1)

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1 results

The (De)composition of Firms: Interdependent Preferences of Corporate Actors *
Andreas Nicklisch
Journal:

European Business Organization Law Review (EBOR) / Volume 10 / Issue 2 / June 2009

Published online by Cambridge University Press:

20 August 2009, pp. 291-305

Print publication:

June 2009
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This article discusses the limitations of the orthodox economic theory of the firm as a nexus of contracts. Various experimental studies have shown that the aggregation of individuals in groups changes behaviour and preferences systematically. This perspective has been formalised by models of interdependent preferences. Based on a prominent approach of interdependent preferences, intention-based preferences, two types of labour contracts, incentive contracts and bonus contracts are analysed. Results are compared with the predictions of the orthodox economic theory.