Abstract:

As an innovative organizationform，crowdsourcing contesthas become an important way for many firms to improve their competitiveness.However，due to these contests’ competitive attribute and the participants’ opportunistic tendency， the firms occur concerns whether their problems can be solved through crowdsourcing contest.Therefore，how firms design contract to incentive participants’ effort has become one of the most important and urgent issues in crowdsourcing contest.In order to solve the design problem of incentive contract between the firm and the participants，firstly，the principal-agent models based on the fixed-price awards and absolute performance are established separately when the participants are completely rational.Then， in view of the widespread behavior of decision-makers’ fairness concerns and altruistic preferences in reality，both of them are taken into consideration in the principal-agent model.Finally，in comparison with the principal-agent model with completely rational participants，the effects on the firm’s design of incentive contract and the participants’ efforts are explored arising from fairness concerns and altruistic preferences.In addition，the difference and effectiveness are compared between the incentive contracts based on the fixed-price awards and absolute performance，which can help to solve selection problem of incentive contract occurred by the participants’ bounded rational behavior.It is found that greater fairness concern and altruistic preference contribute to the improvement of firm’s expected utility. However， smaller fairness concern and altruistic preference have negative effects on the expected utility. Although these two preferences don’t necessarily help the firm improve the expected utility， the firm can always choose the optimal incentive contract for accommodating different preferences. For participants’ fairness concern that plays a leading role and is lager， the firm will choose the incentive contract based on absolute performance. For participants’ altruistic preference that plays a leading role， or participants’ fairness concern that plays a leading role but is small， the firm will choose the incentive contract based on the fixed-price awards.Research results are of practical significance for firms to design and select incentive contract in the crowdsourcing contest.

Key words: fairness concern, altruistic preference, incentive contract, crowdsourcing contest