Organizational Economics


Due to the current special circumstances the lecture, exercise and exam formats may all deviate from the accustomed forms and may depend on the number of paricipants. We will discuss details in the first lecture, and finalize everything in the first month of the semester.

This course is suitable for Master students only (7 LP) and will be held in English.

The course focuses on the provision of incentives in organizations. Since the interests of workers and their employers are not necessarily aligned, an important question is how firms can design compensation schemes or jobs to induce workers to act in the employer's interest. 

In particular, the course covers incentives in team work and tournamens. In teams, the joint performance determines the payoff of individuals, whereas in tournaments the relative performance is relevant. We discuss applications to sports contests and political rent-seeking. Apart from the standard assumption of completely rational and selfish agents (homo oeconomicus), we also consider the effect of non-standard preferences (e.g. envy, inequality aversion or status-concerns).

The course consists of two parts. In the first part, students become familiar with theoretical models and their predictions of individual behavior. In the second part of the course, we study empirical and experimental evidence on actual behavior as well as extensions of the models. Here, students present and critically discuss a paper from the large literature on economic incentives.


All course materials will be available for download at Moodle a few days before the respective lesson. The password for accessing the course at Moodle will be announced in the first lecture.

You can find the slides for the first lecture here:



We will mainly rely on journal papers that are announced during the course.

Additional literature:

  • Mas-Colell, A., M. D. Whinston and J. R. Green, Microeconomic Theory, Oxford University Press 1995.
  • Laffont, J.-J. and D. Martimort, The Theory of Incentives: The Principal-Agent Model, Princeton University Press, 2001.
  • Milgrom, P. and J.Roberts, Economics, Organization & Management, Prentice Hall 1992. 

Dates and Rooms WS19/20

The first lecture will be held on the 25.10. from 10:15 to 14:00 in the room N24/226 statt. The other dates are expected to be:

  • 25.10.  10:15-14:00
  • 8.11.   10:15-14:00
  • 15.11.  no lecture
  • 22.11.  10:15-16:00
  • 29.11.  12:15-16:00 (Tutorial 1+2)
  • 6.12.   14:15-16:00 (Tutorial 3)
  • 13.12.  13:45-16:00
  • 20.12.  ---
  • 17.01.  12:15-16:00 (Tutorial 4+5)
  • 24.01.  10:15-13:00
  • 31.01.  10:15-12:00 (Tutorial 6)
  • 07.02.  10:15-16:00
  • 14.02.  12:00-16:00

Whether there will be a lecture or a tutorial will be announced througout the lecture.



Exams WS19/20

Exams will be open.

  • 1. Exam: 03.03.20, 10:30-11:30, H13
  • 2. Exam: 22.04.20, 14:30-15:30, H20