Is no news bad news? Information transmission and the role of "early warning" in the principal-agent model

Article Abstract:

The standard principal-agent model was used to assess the importance of information in managerial decision making. While it is acknowledged that gaining information to product information can result in better corporate strategy, tradeoffs exist between early warning and effort incentives. Intervention of the principal can negatively affect incentives by mitigating the connection between an agent's work and the project's result.

Planning & Information, Business planning, Strategic planning (Business), Information management

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Renegotiating incomplete contracts

Article Abstract:

The effect of incomplete contracts on production efficiency and exchange is examined. The possibility of renegotiating incomplete contracts enables parties to the contract to come up with first-best allocations. It is thus concluded that the absence of a completely verifiable contract does not detract from the possibility of renegotiation and the implementation of a newly designed contract that satisfies optimal conditions.

Negotiation, Negotiations

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Competition, contracts, and entry in the electricity spot market

Article Abstract:

Analysis of the English electric power generation industry with the inclusion of contract market and contestable entry conditions to the spot market showed that utilities will enter the market when current suppliers offer insufficient power and new plants offer the same output as current plants. This assumes that marginal costs to entry are held constant and that industry demand remains linear.

Competition (Economics), Economic aspects, Electric utilities, Energy use, England, Barriers to entry (Industrial organization), Barriers to entry

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