Arbeitspapier
Regulating damage clauses in (labor) contracts
We analyze the role of damage clauses in labor contracts using a model in which a worker may want to terminate his current employment relationship and work for another firm. We show that the initial parties to a contract have an incentive to stipulate excessive damage clauses, which leads to ex post inefficiencies. This result is due to rent seeking motives a) between the contracting parties vis-à-vis third parties and b) among the contracting parties themselves. We then show that, by imposing an upper bound on the amount of enforceable damages, a regulator can induce a Pareto improvement; in some cases even the first best can be achieved
- Sprache
-
Englisch
- Erschienen in
-
Series: IZA Discussion Papers ; No. 2367
- Klassifikation
-
Wirtschaft
- Thema
-
Arbeitsvertrag
Vertragsrecht
Rent Seeking
Verhandlungstheorie
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Muehlheusser, Gerd
- Ereignis
-
Veröffentlichung
- (wer)
-
Institute for the Study of Labor (IZA)
- (wo)
-
Bonn
- (wann)
-
2006
- Handle
- URN
-
urn:nbn:de:101:1-20090406316
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Muehlheusser, Gerd
- Institute for the Study of Labor (IZA)
Entstanden
- 2006