Arbeitspapier
Exit Options and the Allocation of Authority
We analyze the optimal allocation of authority in an organization whose members have conflicting preferences. One party has decision-relevant private information, and the party who obtains authority decides in a self-interested way. As a novel element in the literature on decision rights, we consider exit option contracts: the party without decision rights is entitled to prematurely terminate the relation after the other party's choice. We show that under such a contract it is always optimal to assign authority to the informed and not to the uninformed party, irrespective of the parties' conflict of interest. Indeed, the first-best efficient solution can be obtained by such a contract.
- Sprache
-
Englisch
- Erschienen in
-
Series: SFB/TR 15 Discussion Paper ; No. 401
- Klassifikation
-
Wirtschaft
Organizational Behavior; Transaction Costs; Property Rights
Asymmetric and Private Information; Mechanism Design
Economics of Contract: Theory
- Thema
-
Authority
decision rights
exit options
incomplete contracts
asymmetric information
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Bester, Helmut
Krähmer, Daniel
- Ereignis
-
Veröffentlichung
- (wer)
-
Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
- (wo)
-
München
- (wann)
-
2013
- DOI
-
doi:10.5282/ubm/epub.15342
- Handle
- URN
-
urn:nbn:de:bvb:19-epub-15342-9
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Bester, Helmut
- Krähmer, Daniel
- Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
Entstanden
- 2013
Ähnliche Objekte (12)
Exit options and the allocation of authority
A sustainable Euro area with exit options
Incentives, Reputation and the Allocation of Authority
Incentives, reputation and the allocation of authority
The allocation of authority under limited liability
Exit options in incomplete contracts with asymmetric information
Exit Options in Incomplete Contracts with Asymmetric Information
Endogenous allocation of the exit option between workers and shareholders
The Impact of Lobbying on the Allocation of Political Authority
Allocation of Authority when a Person is not a Robot
Allocation of Authority when a Person is not a Robot
On human capital formation with exit options : comment and new results
Exit options and the allocation of authority
A sustainable Euro area with exit options
Incentives, Reputation and the Allocation of Authority
Incentives, reputation and the allocation of authority
The allocation of authority under limited liability
Exit options in incomplete contracts with asymmetric information
Exit Options in Incomplete Contracts with Asymmetric Information
Endogenous allocation of the exit option between workers and shareholders
The Impact of Lobbying on the Allocation of Political Authority
Allocation of Authority when a Person is not a Robot
Allocation of Authority when a Person is not a Robot
On human capital formation with exit options : comment and new results
Exit options and the allocation of authority
A sustainable Euro area with exit options
Incentives, Reputation and the Allocation of Authority
Incentives, reputation and the allocation of authority
The allocation of authority under limited liability
Exit options in incomplete contracts with asymmetric information
Exit Options in Incomplete Contracts with Asymmetric Information
Endogenous allocation of the exit option between workers and shareholders
The Impact of Lobbying on the Allocation of Political Authority
Allocation of Authority when a Person is not a Robot
Allocation of Authority when a Person is not a Robot