Konferenzbeitrag
Optimal Allocation of Decision-Making Authority and the Provision of Incentives under Uncertainty
Incentives for managers are often provided by offering them performance-based compensation schemes. The efficiency of such monetary compensations, however, depends on several factors, among them the quality of the employed performance measures, the information available for contracting purposes, and the allocation of decision-making authority which translates into either more centralized or more decentralized organizational structures. This article investigates a firm's decision whether to delegate or retain the authority to decide on a specific job design in a moral hazard environment with asymmetric information on effort costs. It provides conditions under which decentralization is the preferred organizational form. Moreover, it derives the result that the relation between incentives and the delegation of decision-making authority is not univocal, but depends on the quality of the employed performance measure. In this regard, it contributes to explaining the mixed empirical evidence on the relation between incentives and decision-rights.
- Language
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Englisch
- Bibliographic citation
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Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2016: Demographischer Wandel - Session: Organizational Economics: Authority in Organizations ; No. B23-V3
- Classification
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Wirtschaft
Personnel Economics: Compensation and Compensation Methods and Their Effects
Personnel Economics: Labor Contracting Devices
Personnel Economics: Labor Management
- Event
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Geistige Schöpfung
- (who)
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Schöttner, Anja
Rohlfing-Bastian, Anna
- Event
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Veröffentlichung
- (who)
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft
- (where)
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Kiel und Hamburg
- (when)
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2016
- Handle
- Last update
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10.03.2025, 11:44 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Konferenzbeitrag
Associated
- Schöttner, Anja
- Rohlfing-Bastian, Anna
- ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft
Time of origin
- 2016
Other Objects (12)
Optimal Allocation of Decision-Making Authority and the Provision of Incentives under Uncertainty
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Optimal Allocation of Decision-Making Authority and the Provision of Incentives under Uncertainty
Incentives, reputation and the allocation of authority
Incentives, Reputation and the Allocation of Authority
Incentives, reputation and the allocation of authority
Authority and incentives in organizations
Authority and Incentives in Organizations
Authority and Incentives in Organizations
Asset allocation for pension provision
Asset allocation for pension provision
Incentives in health care provision
Incentives for separation and incentives for public good provision
Exit Options and the Allocation of Authority
Optimal Allocation of Decision-Making Authority and the Provision of Incentives under Uncertainty
Incentives, reputation and the allocation of authority
Incentives, Reputation and the Allocation of Authority
Incentives, reputation and the allocation of authority
Authority and incentives in organizations
Authority and Incentives in Organizations
Authority and Incentives in Organizations
Asset allocation for pension provision
Asset allocation for pension provision
Incentives in health care provision
Incentives for separation and incentives for public good provision