组织的经济学与管理学（英文）ch06_Hidden_action_problem教材教学课件.ppt

Chapter 6 Hidden action problem George Hendrikse;Incentives;Figure 6.1: Decision order and complete information;The principal values a good result (p=30) more than a bad result (p=10), whereas the agent rather delivers a low effort (e=0) than a high effort (e=1). ;The conflict of interests expresses itself in the fact that an increase in e, which is unattractive for the agent, means that p=30 becomes more likely, which is attractive for the principal. ;This conflict of interest contrast may result in non acceptance of the contract by the agent, even though executing the transaction would create a surplus. ;It is also possible that the agent does accept the assignment, but shows bad performance (‘Moral Hazard’). ;An efficient allocation of risk implies that the principal bears all the uncertainty, i.e. paying a fixed salary, because the principal is risk-neutral and the agent risk-averse. ;An uncertain reward (‘0 with probability 1/3’ and ‘9 with probability 2/3’, which costs the principal 1/3*0 + 2/3*9 = 6) is valued lower by the agent than a certain reward (‘6 with chance 1’ which costs the principal 6).;The uncertain outcome ‘0 with probability 1/3 and 9 with probability 2/3’ (which costs the principal 6) is worth 2 for the agent, which is the same as a salary ‘4 with chance 1’, which only costs the principal 4. The principal does not offer a fixed salary {4,4} because the agent would choose e=0 in this situation. ;The loss of efficiency is caused by the conflict of interests and the risk-aversion of the agent. It is therefore not possible to establish an efficient allocation of risk as well as efficient performance incentives. (With one variable (?) you cannot solve two problems.);Determine the payoff maximising contract for the principal;Tool: Non-cooperative game theory;Solution concept: Nash equilibrium Subgame perfect equilibrium;Solution method: Backward induction;Incentive compatibility constraint;Figure 6.8: Incentive compatibility constraint under asym