This dissertation explores cooperation when formal contracts and legal institutions are imperfect. The first chapter (co-authored with Isaiah Andrews) considers how a principal allocates business among a group of agents to motivate them in the context of a repeated game with imperfect private monitoring. If players are impatient, the optimal relational contract dynamically allocates future busi...

Social commerce is an emerging platform that entails different social features to attract the attention of online consumers. Borrowing insights from psychological contract theory, this study examines characteristics platforms, such as interactivity and rating reviews influence consumers’ purchase intentions. An survey 430 consumers was conducted on a popular site in China. Partial least squar...

The prevailing informal contracts of farmland transfer in China are facing frequent disputes and defaults, which call for effective self-enforcement mechanisms operating through transactors’ reputations social networks. However, the effects reputation on contract choice have not been thoroughly considered examined by existing research case transfer. This study explores reputation’s ex-ante sign...

Corporate scandals, reflected in excessive management compensation and fraudulent accounts, cause considerable damage. Agency theory’s insistence on linking the compensation of managers and directors as closely as possible to firm performance is a major reason for these scandals. They cannot be overcome by improving variable pay for performance, as selfish extrinsic motivation is reinforced. Ba...

The rCOS is a relational object-based language with a precise observation-oriented semantics. It can capture key features of object model including subtypes, visibility, inheritance, polymorphism and so on. To analyze the model specified by rCOS, we propose a verification approach to check whether those properties such as the assertion, invariant of class and method contracts hold. The Spin mod...

Leveraging a longitudinal data set concerning 102 interfirm disputes, we evaluate the effects of contract structure on trust and on the likelihood of continued collaboration. We theoretically refine and empirically extend prior research by (1) distinguishing between the control and coordination functions of contracts, (2) separating goodwillbased and competence-based trust, and (3) evaluating t...

This paper studies the transition of contract enforcement institutions. The prevalence of relational contracts, low legal quality, strong cultural preference for personalistic relationships, low social mobility, and highly unequal endowment form a cluster of mutually reinforcing institutions that hinder economic development. The cultural element per se does not necessarily reduce social welfare...

I analyze the effect of long-term relations on the property rights theory of the firm when agents’s actions affect the structure of the game. In this setting, renegotiation proof relational contracts exists. Single ownership dominates joint ownership when the discount factor is very high or very low, however there exists a mid-region where joint ownership becomes optimal. Joint ownership has a ...