http://repub.eur.nl/res/aut/1663/ List of Publications en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/22552/ 2011-02-01T00:00:00Z Using simple game-theoretical models, this paper studies the role of pre-determined rules for HRM policies. We consider a model in which HRM decisions affect employees' self-images and thereby their motivation. We show that in the absence of written rules, managers are too reluctant (1) to differentiate between employees on the basis of their abilities, and (2) to terminate employment of employees on probation. Generally, organizations benefit from committing to strict rules for various HRM practices. http://repub.eur.nl/res/pub/22266/ 2009-07-01T00:00:00Z We develop a simple model that describes individuals’ self-assessments of their abilities. We assume that individuals learn about their abilities from appraisals of others and experience. Our model predicts that if communication is imperfect, then (i) appraisals of others tend to be too positive and (ii) overconfidence leading to too much activism is more likely than underconfidence leading to too much passivity. The predictions of our model are consistent with findings in the social psychological literature. http://repub.eur.nl/res/pub/15253/ 2008-09-01T00:00:00Z It is often assumed that bad corporate performance means a bad CEO. The task of a board of directors is then simple: dismiss the executive. If it fails to do so, the board is said to be indolent. We take a kinder approach to observed board behavior and point to the problems even well-intended boards would encounter. They face the twin task of disciplining and screening executives. We analyze the nature of the retention contract a board uses to discipline and screen executives. Consistent with empirical observation, we find that executives may become overly active to show their credentials, and that the link between bad performance and dismissal is weak. http://repub.eur.nl/res/pub/9843/ 2007-04-26T00:00:00Z Every day individuals make numerous choices. What is important for making the right choice is that individuals have good information about the consequences of the different alternatives. However, investigating the full consequences of the different alternatives is complicated and costly. Consequently, individuals sometimes do not possess all relevant information to take a decision. This thesis discusses models in which an agent decides whether or not to perform a task on behalf of the principal. A key element in the models we consider is incomplete and asymmetric information. Broadly, the thesis can be split up into two parts. The first part of the thesis deals with models in which the principal is better informed than the agent. The agent has to decide whether or not to perform a task, but lacks information about his ability. We analyze how the agent makes a self-assessment of his ability, based on appraisals of others (the principal) and experience. Based on this self-assessment the agent takes a decision. The second part of the thesis deals with models in which the agent is better informed than the principal. On behalf of the principal the agent takes a decision about a project. Sometimes agents do not act in the interest of the principal. We analyze how the principal can use retention contracts to discipline the agent. In the remainder of the Introduction we discuss the two parts of the thesis and we provide an overview of the chapters of this thesis. http://repub.eur.nl/res/pub/11751/ 2007-01-01T00:00:00Z It is often assumed that bad corporate performance means a bad CEO. The task of a board of directors is then simple: dismiss the executive. If it fails to do so, the board is said to be indolent. We take a kinder approach to observed board behaviour and point to the problems even well-intended boards would encounter. They face the twin task of disciplining and screening executives. To perform these tasks directors do not have detailed information about executives’ behaviour, and only infrequently have information about the success or failure of initiated strategies, reorganizations, mergers etc. We analyse the nature of (implicit) retention contracts boards use to discipline and screen executives. Consistent with empirical observation, we …nd that executives may become overly active to show their credentials; that the link between bad performance and dismissal is weak; and that boards occasionally dismiss competent executives.It is often assumed that bad corporate performance means a bad CEO. The task of a board of directors is then simple: dismiss the executive. If it fails to do so, the board is said to be indolent. We take a kinder approach to observed board behaviour and point to the problems even well-intended boards would encounter. They face the twin task of disciplining and screening executives. To perform these tasks directors do not have detailed information about executives’ behaviour, and only infrequently have information about the success or failure of initiated strategies, reorganizations, mergers etc. We analyse the nature of (implicit) retention contracts boards use to discipline and screen executives. Consistent with empirical observation, we …nd that executives may become overly active to show their credentials; that the link between bad performance and dismissal is weak; and that boards occasionally dismiss competent executives. http://repub.eur.nl/res/pub/7834/ 2006-06-19T00:00:00Z Boards of directors face the twin task of disciplining and screening executives. To perform these tasks directors do not have detailed information about executives' behaviour, and only infrequently have information about the success or failure of initiated strategies, reorganizations, mergers etc. We analyse the nature of (implicit) retention contracts boards use to discipline and screen executives. Consistent with empirical observation, we find that executives may become overly active to show their credentials; that the link between bad performance and dismissal is weak; and that boards occasionally dismiss competent executives. http://repub.eur.nl/res/pub/12273/ 2006-06-01T00:00:00Z We identify the conditions under which voters can induce political parties to collect information and to select policies which are optimal from the representative voter’s point of view. We show that when parties are office motivated the voting rule should encourage parties to collect information. Voting rules that focus on the opposition party sometimes dominate voting rules that focus on the incumbent party. When parties are policy motivated, they also have to be motivated to select good policies. Generally, it is easier to stimulate policy motivated parties than office motivated parties to collect information. However, in contrast to office motivated parties, policy motivated parties will sometimes select policies that conflict with the representative voter’s interest. http://repub.eur.nl/res/pub/7415/ 2006-01-17T00:00:00Z We develop a simple model that describes individuals' self-assessments of their abilities. We assume that individuals learn about their abilities from appraisals of others and experience. Our model predicts that if communication is imperfect, then (i) appraisals of others tend to be too positive, and (ii) overconfidence leading to too much activism is more likely than underconfidence leading to too much passivity. The predictions of our model are consistent with findings in the social psychological literature. http://repub.eur.nl/res/pub/6605/ 2004-11-18T00:00:00Z A well-known rationale for representative democracy is that direct democracy leads to a free-rider problem as to the collection of information. A problem with this rationale is that it takes for granted that representatives collect information. In this paper we examine whether or not electoral competition induces political parties or candidates to collect information about policy consequences. We show that the answer to this question depends on the cost of information collection. More surprisingly, we find that endogenizing information may lead to divergence of policy platforms. http://repub.eur.nl/res/pub/6654/ 2004-03-22T00:00:00Z We identify the conditions under which voters can induce political parties to collect information and to select policies which are optimal from the representative voter's point of view. We show that when parties are office motivated the voting rule should encourage parties to collect information. Voting rules that focus on the opposition party sometimes dominate voting rules that focus on the incumbent party. When parties are policy motivated, parties have also to be motivated to select good policies. Generally, it is easier to stimulate policy motivated parties to collect information than office motivated parties. However, in contrast to office motivated parties, policy motivated parties will sometimes select policies that conflict with the representative voter's interest.