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How often should you open the door? Optimal monitoring to screen heterogeneous agents
[journal article]
Abstract This paper shows that monitoring a partner too much in the initial phase of a relationship may not be optimal if the goal is to determine his loyalty to the match and if the cost of ending the relationship increases over time. The intuition is simple: by monitoring too much we learn less about how t... view more
This paper shows that monitoring a partner too much in the initial phase of a relationship may not be optimal if the goal is to determine his loyalty to the match and if the cost of ending the relationship increases over time. The intuition is simple: by monitoring too much we learn less about how the partner will behave when he is not monitored. Only by giving to the partner the possibility to mis-behave might he be tempted to do it, and only in this case is there a chance to learn his type at a time where separation would be possible at a relatively low cost.... view less
Keywords
monitoring
Classification
Sociology of Work, Industrial Sociology, Industrial Relations
Free Keywords
Probation; Screening; Asymmetric information
Document language
English
Publication Year
2008
Page/Pages
p. 820-831
Journal
Journal of Economic Behavior & Organization, 67 (2008) 3-4
DOI
https://doi.org/10.1016/j.jebo.2008.02.004
Status
Postprint; peer reviewed
Licence
PEER Licence Agreement (applicable only to documents from PEER project)