Incentive contracts when production is subcontracted
type: Item
instance of: scholarly article
title: Incentive contracts when production is subcontracted
zbMATH Open document ID: 0663.90007
DOI: 10.1016/0377-2217(89)90328-7
author: Kashi R. Balachandran
author: Joshua Ronen
published in: European Journal of Operational Research
publication date: 1989-01-01T00:00:00Z
review text: 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.
Mathematics Subject Classification ID: 91B16
Mathematics Subject Classification ID: 91B24
zbMATH DE Number: 4085366
zbMATH Keywords: pricing
zbMATH Keywords: subcontracting
zbMATH Keywords: agency
zbMATH Keywords: decentralization
zbMATH Keywords: moral hazard
zbMATH Keywords: adverse selection
zbMATH Keywords: Optimal incentive compensation function
zbMATH Keywords: transfer price
MaRDI profile type: Publication
full work available at URL: 0377-2217(89)90328-7
OpenAlex ID: W1990045856
cites work: An Analysis of the Principal-Agent Problem
cites work: Incentives in a Divisionalized Firm
cites work: Optimal incentive contracts with imperfect information
cites work: Asymmetric Information, Incentives and Intrafirm Resource Allocation
cites work: Incentive Compatibility and the Bargaining Problem
description: scientific article; zbMATH DE number 4085366