Working Paper: NBER ID: w8859
Authors: Francine Lafontaine; Scott E. Masten
Abstract: This paper considers functions of contracting other than the protection of relationship-specific investments and the provision of marginal incentives, and applies the theory to explain variation in the form of compensation of over-the-road truck drivers in the U.S. Specifically, we argue that contracts in this industry serve to economize on the costs of price determination for heterogeneous transactions. We show that the actual terms of those contracts vary systematically with the nature of hauls in a way that is consistent with the theory. By contrast, we find that vehicle ownership, which defines a driver's status as an owner operator or company driver, depends on driver, but not trailer or haul, characteristics.
Keywords: No keywords provided
JEL Codes: L2; D2; J3; L9
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| haul characteristics (L92) | compensation structures for truck drivers (J33) |
| type of truck used (L92) | compensation method employed (J33) |
| driver characteristics (R48) | vehicle ownership status (R48) |