Question: 1 If contracts are incomplete would allocating some control rights

(1) If contracts are incomplete, would allocating some control rights to employees be an efficient way to induce employees to develop firm-specific human capital? Explain
(2) Since the government introduced codetermination by law and shareholders did not voluntarily choose it, is codetermination beneficial to shareholders?
(3) How might shareholders attempt to allocate capital to minimize the influence of employees?
(4) What are the incentives of the employees on the board? What are the incentives of outside directors? Are they in conflict?
(5) Would you argue that less wage dispersion and more stable wages over the business cycle is good or harmful to the company, to the employees, to society in general?

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  • CreatedSeptember 27, 2014
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