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The Impact of Incentive Pay on Corporate Crime
This paper presents a moral hazard model analyzing the agent's incentive to commit corporate crime. The principal can only observe profits which the agent can increase by committing crime or exerting effort. It is shown how different incentive contracts, i.e., thresholdlinear, capped bonus...
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| Pubblicato in: | MAGKS - Joint Discussion Paper Series in Economics (Band 52-2017) |
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| Autore principale: | |
| Natura: | Articolo |
| Lingua: | inglese |
| Pubblicazione: |
Philipps-Universität Marburg
2017
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| Soggetti: | |
| Accesso online: | PDF Full Text |
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| Riassunto: | This paper presents a moral hazard model analyzing the agent's
incentive to commit corporate crime. The principal can only observe
profits which the agent can increase by committing crime or exerting
effort. It is shown how different incentive contracts, i.e., thresholdlinear,
capped bonus and linear contracts, can be adjusted in order to
promote agent's law abiding behavior. Any adjustment implies a loss
in internal efficiency which decreases in individual sanctions imposed
on the agent. |
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| Descrizione fisica: | 34 Seiten |
| ISSN: | 1867-3678 |
| DOI: | 10.17192/es2024.0549 |