Self-Selection and Monitoring in Dynamic Incentive Problems with Incomplete Contracts
研究垄断雇主在员工生产率和保留工资均为私人信息时的动态雇佣问题，雇主通过监督不可验证的工作表现间接了解员工质量，并比较长期合同（市场筛选）与短期合同（监督）两种均衡路径。
A dynamic trading problem is examined in which a monopsonistic employer tries to hire workers whose productivities and reservation wages are private information. The employer can only observe an employee's quality indirectly by monitoring a non-verifiable measure of on-the-job performance. The employer makes contract offers which employees can accept or reject. Once a contract has been accepted it is impossible for the employer to exchange messages with individual employees. On the unique stationary equilibrium path for the contracting game, the employer chooses between two mutually exclusive outcomes. In the market outcome, the employer offers long-term contracts and information is conveyed entirely through self-selection and delayed production. In the monitoring outcome, the employer offers short-term contracts, and contract renegotiation is conditioned by an employee's past performance. A simple characterization theorem is provided which illustrates the often surprising effects of improvements in information in this setting. For example, an employer who is initially offering short-term contracts to exploit performance information may stop monitoring and shift to market screening when the monitoring technology becomes more informative.