Incentive contracts when production is subcontracted (Q1115327)
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scientific article; zbMATH DE number 4085366
| Language | Label | Description | Also known as |
|---|---|---|---|
| English | Incentive contracts when production is subcontracted |
scientific article; zbMATH DE number 4085366 |
Statements
Incentive contracts when production is subcontracted (English)
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1989
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The problem of pricing for products under subcontracting is set in an agency theory format. Characteristics of decentralization, moral hazard and adverse selection are inherent in this problem. Optimal incentive compensation function and the transfer price are analyzed. The results are illustrated with an example of logarithm utility functions.
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pricing
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subcontracting
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agency
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decentralization
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moral hazard
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adverse selection
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Optimal incentive compensation function
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transfer price
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