An uncertain contract model for rural migrant worker's employment problems
This paper studies the implementation of the employment relationship problem between the enterprise (he) and the rural migrant worker (she) in labor market. An uncertain contract model is established to maximize the expected utility of the enterprise under incentive feasible mechanism, in which the enterprise's assessment of the rural migrant worker's own income at home is subjective, and characterized as an uncertain variable. The crisp equivalent model is then presented and the optimal solution for the equivalent model is obtained. The results show that if the rural migrant worker's own income at home is higher, she is less willing to pay much effort on work, i.e., the rural migrant worker's optimal effort level decreases with her income at home. Finally, a numerical example is presented to show the effectiveness of the model.
contract uncertainty theory private information