Combining empathy into agency theory
Our collaboration with Debraj Ray brings about a new paper. We discussed it at NYU seminar, with wonderful comments from Ennio Stacchetti, David Pearce, Dilip Abreu, In essence, in this paper asks relevant questions for the contract theory if agents are not (solely) driven by material self-interest. Relaxing the material self-interest assumption affects both the optimal incentive structure and implications for optimal contracts. This is work in progress, so all comments are more than appreciated. The working version of the paper is coming soon.