Design of Dynamic Incentive Contract of Sales Personnel Based on Multi-task Objectives*

DOI

10.2991/aebmr.k.191225.098How to use a DOI?

Keywords

multitask objectives, dynamic incentive, salesperson

Abstract

Based on the multi-task principal-agent model proposed by Holmstrom, the article divides the sales staff’s work into two dimensions: pursuit of current performance and improvement of corporate reputation. The single-cycle static contract and multi-cycle dynamic contract were constructed respectively, and the changes of sales staff’s work input and enterprise income under the two types of incentive contracts were compared and numerical analysis was carried out. The results show that when the company signs a dynamic incentive contract with the sales staff, the sales staff will make greater efforts for the long-term reputation of the company. The better the corporate reputation, the greater the efforts of sales people to increase their reputation. The greater the sales staff’s efforts to contribute to the output in the current period, the more the sales staff and the company pay attention to the short-term benefits. The dynamic incentive contract for businesses and salespeople is Pareto improvement.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Min Li
PY  - 2020
DA  - 2020/01/07
TI  - Design of Dynamic Incentive Contract of Sales Personnel Based on Multi-task Objectives*
BT  - Proceedings of the 5th International Conference on Economics, Management, Law and Education (EMLE 2019)
PB  - Atlantis Press
SP  - 548
EP  - 554
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.191225.098
DO  - 10.2991/aebmr.k.191225.098
ID  - Li2020
ER  -