Working Paper No. 618

Deadlines and Distractions

Published: April 13, 2004; Revised October 12, 2005Pages: 21Keywords: Deadlines; Time-Consistency; Timing of Effort; Optimal IncentivesJEL-codes: D81; J22; M50

Deadlines and Distractions Maria Saez-Marti and Anna Sjögren


We analyze the effect of deadlines on timing of effort when agents are occasionaly distracted. We show that agents get started early when completion of the task is uncertain, but rather likely. Agents who are rarely distracted will always postpone effort since the risk of not completing is small. As a result, agents who are more often distracted may out perform rarely distractes agents. We further show that principals can increase the probability that a task gets done and thus achieve higher profits by setting harsh deadlines, provided that they sometimes grant extensions or postpone the deadline.

 

Interdisciplinary European Studies

The European Union in a Changing World Order

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This book explores how the European Union responds to the ongoing challenges to the liberal international order. These challenges arise both within the EU itself and beyond its borders, and put into question the values of free trade and liberal democracy. 

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