TY  - RPRT
        AU  - Prat, Julien
        TI  - Dynamic Contracts and Learning by Doing
        PY  - 2014/Feb/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 7961
        UR  - https://www.iza.org/index.php/publications/dp7961
        AB  - This paper studies the design of optimal contracts in dynamic environments where agents learn by doing. We derive a condition under which contracts are fully incentive compatible. A closed-form solution is obtained when agents have CARA utility. It shows that human capital accumulation strengthens the power of incentives and allows the principal to provide the agent with better insurance against transitory risks.
        KW  - human capital
KW  - principal agent problem
KW  - moral hazard
        ER  -