Business and management dictionary and Often, the principal may be sufficiently concerned at the possibility of being exploited by the agent that they choose not to enter into the transaction at all, when it would have been mutually beneficial: a suboptimal outcome that can lower welfare overall. Business and management terms dictionary glossary of terminology and definitions from business and management
Central Bank of Neria News Archives The problem arises where the two parties have different interests and asymmetric information (the agent having more information), such that the principal cannot directly ensure that the agent is always acting in their (the principal's) best interest, particularly when activities that are useful to the principal are costly to the agent, and where elements of what the agent does are costly for the principal to observe (see moral hazard and conflict of interest). The payments system plays a very crucial role in any economy, being the channel through which financial resources flow from one segment of the economy to the other.
Graduate School of Business Stanford The principal–agent problem, in political science and economics, (also known as agency dilemma or the agency problem) occurs when one person or entity (the "agent") is able to make decisions on behalf of, or that impact, another person or entity: the "principal". The mission of the Stanford Graduate School of Business is to create ideas that deepen and advance the understanding of management, and with these ideas,
Twitpic - Share photos and videos on Twitter Consider a legal client (the principal) wondering whether their lawyer (the agent) is recommending protracted legal proceedings because it is truly necessary for the client's well being, or because it will generate income for the lawyer. Twitpic Inc, All Rhts Reserved. Home Contact Terms Privacy
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