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- W2000141013 abstract "Abstract In a seminal paper, B. R. Holmstrom and P. R. Milgrom (1987, Econometrica55, 303–328) examine a principal-agent model in which the agent continuously controls the drift rate of a Brownian motion. Given a stationary environment, they show that the optimal sharing rule is a linear function of aggregated output. This paper considers a variant of the Brownian model in which control revisions take place in discrete time. It is shown that no matter how “close” discrete time is to continuous time, the first-best solution can be approximated arbitrarily closely with a random spot check and a suitably chosen sequence of step functions. Journal of Economic Literature Classification Numbers: D82, J33." @default.
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- W2000141013 date "2000-04-01" @default.
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- W2000141013 title "Asymptotic Efficiency in Dynamic Principal-Agent Problems" @default.
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- W2000141013 doi "https://doi.org/10.1006/jeth.1999.2623" @default.
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