This paper analyzes the role of the agent's bankruptcy constraints in multiperiod principal-agent models with asymmetric information. Conditions are provided under which commitment to a long-term contract involving N rounds of investment improves upon repetition of N identical single-period...

Stereotypically, marketing is mainly concerned about satisfying customers and manufacturing is mainly interested in factory efficiency. Using the principal-agent (agency) paradigm, which assumes that the marketing and manufacturing managers of the firm will act in their self-interest, we seek...

Empirical studies of information systems planning practices in organizations indicate that wide variations exist. We propose and test a model based on agency theory and transaction-costs economics to account for these variations. As senior management's uncertainty with respect to the information...

This paper reconciles three stylized facts about capital budgeting in firms and shows that they are tied to the presence of asymmetric information among the several members of the firm, each with his or her own objectives and decisions. The facts of interest are: 1. The existence of...

This article studies the problem of sales-force compensation by considering the impact of sales-force behavior on a firm's production and inventory system. The sales force's compensation package affects how the salespeople are going to exert their effort, which in turn determines the sales...

Fair process research has shown that people care not only about outcomes, but also about the process that produces these outcomes. For a decision process to be seen as fair, the people affected must have the opportunity to give input and possibly to influence the decision, and the decision...

This paper investigates the wealth effects of private equity (PE) investor purchases of shares in German quoted companies. It is the first study to analyze these effects for the German market which is particularly interesting due to its distinct characteristics with regard to the ownership...

Goal structures in family firms seems of particular interest to the field as the overall orientation and the objectives of family firms are determined in an area of potential conflict between the two subsystems of firm and family. We asked shareholders of German family firms to rate the...

The direct evolutionary approach according to Leininger (2003) states that players in a two player Tullock rent-seeking contest within a fi nite population behave „as if“ they were relative payoff maximizers. Accordingly contest expenditures are higher than in Nash equilibrium. The indirect...