The existing delegation literature has focused on different preferences of principal and agent concerning project … selection, which makes delegating authority costly for the principal. This paper shows that delegation has a cost even when the … without task commitment and other behavioral effects the principal might forgo delegation though being efficient …

Employers structure pay and employment relationships to mitigate agency problems. A large literature in economics … agency in employment relationships relies on highly stylized assumptions regarding human motivation, e.g., that employees … behavioral complexity and realism into models of agency within organizations. Specifically, we assess the insights gained by …

of some policy action ('investment'). We build an agency model that accounts for these tendencies. The optimal …

based on authority rights and minimizing costs for implementing high efforts. Concentrated delegation and hierarchical … delegation turn out to be never an optimal compromise. If the CEO is more efficient than the division heads (i.e., the CEO …'s costs from exerting high effort are smaller than those of the division heads), the owner will prefer full delegation to the …

performance of the treatment stores. As predicted by theory, we find that treatment stores that lag far behind do not respond to …