Strategic alliances in product development and marketing are crucial to the biotechnology industry. Many alliances, however, are terminated before the drug reaches the market. In this article we make the case that strategic alliances can fail because of how they are negotiated. Alliance contracts are often inflexible and do not allow for changes in market conditions. We propose a model for cont...

Ecotourism as a strategy for achieving biodiversity conservation often results in limited conservation impact relative to its investment and revenue return. In cases where an ecotourism strategy has been used, projects are frequently criticized for not providing sufficient evidence on how the strategy has reduced threats or improved the status of the biodiversity it purports to protect. In Lao ...

The standard contract theory adopts the traditional hypothesis of pure self-interest. However, a series of game experiments have proven that people are not any self-interest but also inequity averse. Then, how will the inequity aversion influence the optimal contract for multiple agents? This paper attempts to obtain new theoretical insights by incorporating inequity aversion into the standard ...

This note derives the optimal compensation contract with subjective evaluation when the principal and agent may not agree regarding performance. The optimal contract takes the form of a bonus payment whenever the principal believes performance is acceptable, but with the payment of a penalty by the principal whenever the agent disagrees with a negative evaluation by the principal. The efficienc...

by considering the competitive advantages of takaful over conventional insurances, such as sharing the underwriting profit (surplus) and return of investment, an investigation into and providing the takaful model based on shiite jurisprudence is necessary and unavoidable. accordingly, with a survey of the legal structure of conventional takaful and identification of its problems according to im...

This paper studies a contract design problem in a setting where time clauses are important. A principal hires an agent to complete a project within a …xed time horizon and prefers to have the project done as early as possible. The agent whose e¤ort is not contractible has a tendency to shirk and to delay exerting e¤ort. We show that in the principal’s optimal contract, deadlines and payment sch...

The 1990 general practitioners (GPs) contract introduced item of service payment for minor surgery, payable for six categories of procedure. Early review showed no substitution of cheaper procedures for more expensive treatments. Detailed payment data from six Health Authorities for the period 1993-2000 show an 11 per cent increase in claims, largely accounted for by the rise in cautery, incorp...

We consider a continuous-time setting, in which the agent can control both the drift and the volatility of the underlying process. The principal can observe the agent’s action and can offer payment at a continuous rate, as well as a bulk payment at the end of the fixed time horizon. In examples, we show that if the principal and the agent have the same CRRA utility, or they both have (possibly ...