Deadlines and Distractions

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.