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Cover von: Limited Communication and Responsibility Budgeting
Dongsoo Shin, Sungho Yun

Limited Communication and Responsibility Budgeting

Rubrik: Articles
Jahrgang 173 (2017) / Heft 3, S. 548-564 (17)
Publiziert 09.07.2018
DOI 10.1628/093245616X14701162930217
Veröffentlicht auf Englisch.
inkl. gesetzl. MwSt.
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Aufgrund einer Systemumstellung kann es vorübergehend u.a. zu Zugriffsproblemen kommen. Wir arbeiten mit Hochdruck an einer Lösung. Wir bitten um Entschuldigung für die Umstände.
Beschreibung
We consider an agency model with three-tier hierarchy, in which the principal cannot observe the manager's and the worker's task environments. Communication is limited in that only the manager can report to the principal about the task environments. The principal decides whether or not to give the manager responsibility for project budgeting. Under responsibility budgeting, the manager receives all of the resources for the project tasks and shares those resources with the worker. Although the manager in such an arrangement has more direct sources of information rent, his rent-seeking incentive becomes weaker. This trade-off determines whether or not larger responsibility for budgeting is optimal. (JEL: D82, D86)