• The results of the second exam are available at the "Hochschuldiensteportal".
  • The exam inspection (for the second exam) will take place on Wednesday, 04/29/2015, from 08:00 a.m. - 09:00 a.m. in room 1.25 (Helmholtzstraße 18).

  • The second exam will take place on Wednesday, 04/08/2015, from 02:30 p.m. - 03:30 p.m. in room 1.20 (Helmholtzstraße 18).

  • The results of the presentation part are available at the "Hochschuldiensteportal".

General Information

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 team work and tournamens, in which the relative performance of individuals determines their payoff. 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 will become familiar with theoretical models and their predictions of individual behavior. Here, we also discuss applications to sports contests and political rent-seeking. In the second part of the course, we will study empirical and experimental evidence on actual behavior as well as advancements of the models. In the second part, students will present and critically discuss a paper from the large literature on economic incentives. 


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

Tuesday, 14:15 - 15:45 — Helmholtzstr. 18, 1.20

Thursday, 14:15 - 15:45 — Helmholtzstr. 18, E.20

Lecture Prof. Dr. Sandra Ludwig

Tutorials Kristijan Hromek


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.