Compensation Contract Design And Operation Decision With Outside Option

The rapid economic development and technology advancement bring corporations both significant opportunities and great challenges.Firms come arocss multiple urgent problem to be solved,for instance,the aggravation of environmental pollution,severe blind investment,inadequate R&D innovation,employee pressure explosion,serious brain drain crisis,etc.This thesis investigates how the firm designs compensation contract and makes the operation decisions,such as pollution prevention strategy selection,investment decision,R&D investment and workforce planning,when the worker has outside option(the worker's opportunity or salary from outside company).The main contents researched in this thesis are as follows:A managerial compensation contract and environmental strategies problem with outside option is investigated,where the manager's pollution prevention ability(his private information)affects his outside option and the choice of pollution prevention strategy.Based on the principal-agent theory,this thesis establishes a managerial compensation contract and pollution prevention model,obtains the optimal managerial compensation contract and pollution prevention strategy through optimal control method.A managerial contract and intertemporal investment problem with on-the-job search is studied,in which the manager's on-the-job search affects his outside option,and the profitability of the intertemporal investment project is his private information.In order to retain the manager and prevent his from on-the-job search behavior,the company should design the managerial compensation and investment strategy.Based on the principal-agent theory,this thesis establishes a managerial compensation contract and intertemporal investment model,and solves the problems with and without on-the-job search thorough optimal control method and obtains the optimal compensation contact and investment strategy.A managerial contract and R&D investment problem under asymmetric information is investigated,where the manager makes the R&D investment decision,and the profitability of R&D investment is his private information.A two-period principle-agent about the managerial compensation and R&D investment is established,which is solved by the maximum principle and the optimal compensation contract and R&D investment are obtained.At last,this thesis discusses the effects of asymmetric information and type-dependent outside option on the optimal incentive and R&D investment decision.To investigate the effect of employees' job satisfaction,which takes outside option as reference point,on the firm's workforce planning,a multi-period uncertain workforce planning model is built.The job satisfaction level is defined as the employees' psychological satisfaction about overtime through prospect theory.Based on the properties of the model,a hybrid joint operations algorithm(JOA)integrated with approximation approach is designed to solve the proposed workforce planning problem.Consequently,several numerical experiments are conducted to compare our proposed JOA with a hybrid particle swarm optimization algorithm to verify the effectiveness of the JOA algorithm.