Incentives, Compensation, and Social Welfare
从社会福利角度分析道德风险下的薪酬结构，指出事后公平目标与激励需求存在冲突，并通过模型证明排名锦标赛在福利上劣于独立合同，最优薪酬方案需平衡公平与激励。
Alternative wage structures under conditions of moral hazard are analysed from a social welfare standpoint. It is argued that ex post equity judgements in an uncertainty context should incorporate a preference for "positive correlation" of utilities of different individuals. In the design of compensation schemes, this may give rise to a conflict between ex post equity objectives and the need to provide effort incentives: relative performance clauses in compensation schemes that are useful for providing incentives are undesirable from an ex post equity standpoint. This is demonstrated by showing (a) in a context of independent production uncertainties, every rankorder tournament is welfare-dominated by a set of independent (randomized) contracts, and (b) welfare-optimal compensation schemes in general depend separately on an equity and an incentive component that tend to correlate agent compensations in different directions.