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Empowerment and the dark side of delegation
Kräkel, Matthias - 2018
The existing delegation literature has focused on different preferences of principal and agent concerning project … selection, which makes delegating authority costly for the principal. This paper shows that delegation has a cost even when the … without task commitment and other behavioral effects the principal might forgo delegation though being efficient. …
Persistent link: https://www.econbiz.de/10011795221
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Haftungsregeln und Innovation
Czarnitzki, Dirk; Kraft, Kornelius - 2000
This paper discusses the incentives for innovation when liability is limited or not. Clearly innovative activity involves risk. On the one hand, the risk of firm owners is limited if their liability is limited. On the other hand credits will be more difficult to receive if liability is limited....
Persistent link: https://www.econbiz.de/10011444773
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Shareholder liability and bank failure
Aldunate, Felipe; Jenter, Dirk; Korteweg, Arthur; … - 2021
Does enhanced shareholder liability reduce bank failure? We compare the performance of around 4,200 state-regulated banks of similar size in neighboring U.S. states with different liability regimes during the Great Depression. The distress rate of limited liability banks was 29% higher than that...
Persistent link: https://www.econbiz.de/10012584232
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Limited liability and the demand for coinsurance by individuals and corporations
Bergesio, Andrea; Koch Medina, Pablo; Munari, Cosimo-Andrea - 2021
Within the context of expected utility and in a discrete loss setting, we provide a complete account of the demand for insurance by strictly-risk averse agents and risk-neutral firms when they enjoy limited liability. When exposed to a bankrupting, binary loss and under actuarially fair prices,...
Persistent link: https://www.econbiz.de/10012614542
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Foundations of corporate law
Armour, John; Hansmann, Henry B.; Kraakman, Reinier H.; … - 2017
This paper is the first chapter of the third edition of The Anatomy of Corporate Law: A Comparative and Functional Approach, by Reinier Kraakman, John Armour, Paul Davies, Luca Enriques, Henry Hansmann, Gerard Hertig, Klaus Hopt, Hideki Kanda Mariana Pargendler, Georg Ringe, and Edward Rock...
Persistent link: https://www.econbiz.de/10011674057
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Collusive effects of a monopolist's use of an intermediary to deliver to retailers
Teichmann, Isabel; Schlippenbach, Vanessa von - 2014
A manufacturer contracting secretly with several downstream competitors faces an opportunism problem, preventing it from exerting its market power. In an infinitely repeated game, the opportunism problem can be relaxed. We show that the upstream firm's market power can be restored even further...
Persistent link: https://www.econbiz.de/10010467434
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Our product is unique : a note on a delegation game with differentiated products
Buchen, Clemens; Hartmann, Sven A.; Palermo, Alberto - 2021
consider a delegation game, for which the owner of a firm hires a manager who acts as if the good has a lower degree of … design an incentive scheme accordingly, which leads the manager to act in this way. Both firms rely on delegation. We discuss …
Persistent link: https://www.econbiz.de/10012595219
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Leaning against the wind : debt financing in the face of adversity
Brennan, Michael J.; Kraft, Holger - 2015
We offer evidence of a new stylized feature of corporate financing decisions: the tendency of managers to rely more on debt financing when earnings prospects are poor. We term this 'leaning against the wind' and consider three possible explanations: market timing, precautionary financing, and...
Persistent link: https://www.econbiz.de/10011434790
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Leaning against the wind : debt financing in the face of adversity
Brennan, Michael J.; Kraft, Holger - 2016
We offer evidence of a new stylized feature of corporate financing decisions: the tendency of managers to rely more on debt financing when earnings prospects are poor. We term this 'leaning against the wind' and consider three possible explanations: market timing, precautionary financing, and...
Persistent link: https://www.econbiz.de/10012061872
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Financing asset growth
Brennan, Michael J.; Kraft, Holger - 2013
In this paper we provide new evidence that corporate financing decisions are associated with managerial incentives to report high equity earnings. Managers rely most heavily on debt to finance their asset growth when their future earnings prospects are poor, when they are under pressure due to...
Persistent link: https://www.econbiz.de/10010226719