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One of the central results of economics is that incentives matter. Contract theory, the branch of economics that is concerned with the optimal design of incentives, has seen a considerable growth in the last decades. In the most simple model, a principal wants to delegate a task he cannot conduct himself to an agent who incurs a disutility from working. Hence, the incentives of principal and agent are not aligned, and the principal has to design an appropriate incentive scheme which motivates the agent to perform the task at the lowest cost. Contracting frictions arise when the effort of the agent is not observable by the principal or when she does not know whether the agent is highly skilled or lacking ability. Early studies on incentive provision have covered problems where the principal delegates one task to one agent. However, most real-world contracting problems consist of more than one task to be carried out, and principals typically hire more than one agent. In such situations, the interactions between the agents and between the incentives for the individual tasks have to be taken into account. Since the seminal paper by Holmström and Milgrom (1991), such problems have become of great interest to the theory of incentives. This thesis consists of four self-contained chapters concerning problems where there are multiple tasks to be delegated. One study is theoretical, two combine theory and evidence from the laboratory, and one is experimental. Testing the predictions of contract-theoretical models empirically is subject to difficulties due to the non-observability of the agents' efforts or their types. Hence, the controlled environment of laboratory experiments is very useful as a first step for testing the empirical relevance of the theoretical models. In Chapter 2, we analyze a theoretical model where an uninformed decision-maker has to make a decision based on evidence in favor and against a proposal. The information is gathered by two biased groups, one of which searches for favorable evidence while the other searches for evidence against the proposal. Chapter 3 theoretically and experimentally considers a problem where a principal has to delegate two tasks that are in direct conflict with each other. In the theoretical and experimental study presented in Chapter 4, a government wants to provide a public service. It can delegate the two tasks of building and subsequently operating the facility either to a public-private partnership or to two independent private contractors. In our experimental studies, social preferences in the form of fairness and reciprocity influence our results. While social preferences have received considerable attention in experimental economics, there are only a few studies on the effect of cognitive abilities. We report on a short experimental study in Chapter 5 on the relationship between cognitive abilities and behavioral biases.

As regards the selection of tasks in the municipality sector, the local authorities have freedom both according to the former and current legislation. The advantages of providing tasks through companies owned by the municipality include the flexible adaptation to market conditions and integration into the relation network of the economy. In case of appropriate operation, the companies can be characterized by higher cost efficiency and by providing services of higher quality to the citizens and business actors. Moreover they ensure revenues for the municipality. The operation of companies, however, depends on municipality management, it is part of it because in many cases the tasks are assigned to them by the law. Some research works have proven, however, that their operation is rather risky, which in return determines the municipality operation, according to the above outlined thoughts. Out of the companies owned by municipalities of county rank, the present paper examines the management of water works, waste management and district heating companies between 2009 and 2011. We selected these three sectors because the (which?) municipalities had pricing authority competences at that time, therefore the operation of these companies was substantially affected by the fee policy of the municipality. In the frames of the research we reviewed the reports of companies and compared the formed indices, evaluating primarily their profitability, indebtedness, and solvency. In regards to liabilities of the examined companies, the dominance of short-term liabilities, increasing receivables and the profitable management were clear phenomena in most cases within the sample.

The Complex Coordination Test was used to examine component-total task relationships when component tasks are practiced in different orders. Sixty subjects practiced (two trials of two minutes each) on six component tasks and on the total task, practicing these in various orders. Part-tasks were three single-level (one rudder and two stick control) tasks and three double-level (one stick-stick and two rudder-stick) tasks. Correlational analyses were performed to determine component-total task relationships and component to total task predictability. It was found that order of part-task practice affects total task proficiency. Also, part-task scores can be combined in a statistically independent manner to yield prediction scores on a more complex task only when a specific double-level task is combined with a specific single-level task. It was also found that observed and predicted total task scores agree better when double-level tasks are practiced before rather than after the total task. Finally, prior practice on double-level tasks led to better total task proficiency than did prior practice on single-level tasks.

When a dual tracking task consisting of two incoherent (uncorrelated) subtasks is partly integrated, such that it is characterized by incompatibility of similarity, or when axis similarity of subtasks is high, it may be difficult to map subtask stimuli to the proper responses. Especially for older adults, an increase in mapping demands may be a source of confusion (cross talk). In the present experiment this issue was addressed with a dual task consisting of two unrelated one-dimensional compensatory tracking tasks with position dynamics. Task performance was measured in terms of root mean square tracking error and cross-axial correlations. Tracking error data were consistent with the hypothesis that older subjects are penalized when there is incompatibility between control and display integration. In general, negative effects of incompatibility of integrality were the greatest when partial integration involved integration of the response component. Both performance measures indicated that with increasing incoherent similarity, task performance of the old subjects was more hampered than was that of their young counterparts.

Relative to bar displays, object displays have repeatedly elicited superior performance for tasks involving information integration. This has been attributed to the emergent feature that is present in such displays; however, the attentional strategy used by the subjects may also playa role. Most previous research has had subjects perform the information integration task much more frequently than the separable tasks. Therefore, subjects may have learned to attend to the information integration task more, and thus they performed it better than they did the separable tasks. The present experiment manipulates the probability of the occurrence of the information integration and separable tasks. As the probability of the integral task increased, absolute error increased for the separable task but remained constant for the integral task. Also, reaction time dropped sharply for the integral task as the probability of the integral task increased, but it rose slowly for the separable task. Before using object displays, designers of visual displays should consider the attentional strategy of the operator.

The effects of different amounts of single- and dual-task practice were evaluated on the fourth, final training trial and with two transfer trials-a dual-task setting with the same tracking task that was used during practice and a dual-task setting with two different component tasks. Results showed that single-task practice contributed little to subsequent dual-task performance, but that the amount of dual-task practice was a major determinant of subsequent dual-task performance. In addition, the amount of dual-task practice resulted in positive transfer to the dual-task setting with the same tracking task in a linear fashion. A post hoc analysis revealed that the effects of practice on the transfer tasks were partially dependent upon the subject ability levels.