We study a continuous-time contracting problem in which project scale plays a role. The agent may speculate to enhance the drift of a cash-flow process; doing so exposes the principal to large, infrequent losses. The optimal contract includes scale as an instrument: downsizing along the equilibrium path is necessary to preserve incentive compatibility. We characterize the optimal contract, and specifically the downsizing process, and prove there is an optimal liquidation scale that is reached in finite time. We also analyze some finer properties of the state variables of the contract and the resulting value function of the principal. The optimal contract is implemented using standard financial securities plus debt covenants; holding equity is essential to curb risk taking. Conflicts emerge between classes of security holders and explain phenomena like priority of claims at liquidation.

我们研究了项目规模在其中发挥作用的连续时间承包问题。代理人可能推测会增加现金流量过程的漂移；这样做会使本金遭受巨大的，罕见的损失。最优合同包括规模作为工具：为了保持激励相容性，必须沿着均衡路径缩小规模。我们描述了最佳合约，特别是缩编过程的特征，并证明了在有限时间内达到了最佳清算规模。我们还分析了合同状态变量的某些更优属性以及委托人的所得价值函数。最佳合同是使用标准金融证券加债务契约实施的；持有股权对遏制冒险至关重要。