Observability and incentive in organizations

Sanxi Li, Bing Ye and Jianyu Yu ()

Economics Letters, 2012, vol. 114, issue 2, 205-207

Abstract: The paper shows that producer-owned firms are more efficient in quality provision than investor-owned firms if input quality is observable, while they are less efficient when the input quality is unobservable and the size of the organization is large.

Keywords: Producer-owned firm; Investor-owned firm; Moral hazard in team; Observability (search for similar items in EconPapers)
JEL-codes: D2 D8 L2 L3 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:114:y:2012:i:2:p:205-207

DOI: 10.1016/j.econlet.2011.09.025

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