Agency theory studies the impact of and remedies to asymmetrically distributed information in principal-agent relations. Yet, it does so in a surprisingly binary manner: It assumes the principal to be perfectly knowledgeable of some pieces of information (such as the agent’s risk aversion), while others (such as the agent’s true effort exerted) are considered to be perfectly private information of the agent. Agency theory thus makes highly asymmetrical assumptions about the knowledge of principals and agents, largely neglecting the role of individual differences in the human capacity to read other people’s desires, intentions, knowledge, and beliefs—that is, to have an imperfect theory of someone else’s mind. This study explores the implications of instilling agency theory with a more realistic account of this (bounded) human capacity.

Epistemics at work: the theory of mind in principal-agent relations

Foss, Nicolai J.;
2017

Abstract

Agency theory studies the impact of and remedies to asymmetrically distributed information in principal-agent relations. Yet, it does so in a surprisingly binary manner: It assumes the principal to be perfectly knowledgeable of some pieces of information (such as the agent’s risk aversion), while others (such as the agent’s true effort exerted) are considered to be perfectly private information of the agent. Agency theory thus makes highly asymmetrical assumptions about the knowledge of principals and agents, largely neglecting the role of individual differences in the human capacity to read other people’s desires, intentions, knowledge, and beliefs—that is, to have an imperfect theory of someone else’s mind. This study explores the implications of instilling agency theory with a more realistic account of this (bounded) human capacity.
2017
9780190650230
Hitt, Michael A.; Jackson, Susan E.; Carmona, Salvador; Bierman, Leonard; Shalley, Christina E.; Wright, Douglas Michael
The Oxford handbook of strategy implementation
Linder, Stefan; Foss, Nicolai J.; Stea, Diego
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11565/4002183
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