A signaling approach to soft budgets

A new explanation for soft budget constraints is given. Projects of an agent are often the more profitable, the more confident the agent is in the principal's competence and/or supports. Principals can signal support and/or competence through a soft budget constraint.

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Year of publication:	2011
Authors:	Saljanin, Salem
Published in:	Economics Letters. - Elsevier, ISSN 0165-1765. - Vol. 111.2011, 3, p. 272-274
Publisher:	Elsevier
Subject:	Soft budget constraint Signaling

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Type of publication:	Article
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10009218904