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Information, Competition, and Markets

Stiglitz, Joseph E.; Nalebuff, Barry J.

Not only can competition provide a basis of comparison, which enables the design of reward structures that can simultaneously provide a high level of incentives with relatively low level risk; but compensation schemes based on relative performance have the further advantage of automatically adjusting incentives to changes in the economic environment.

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American Economic Review

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Economics
Published Here
April 30, 2013