Advanced Search
MyIDEAS: Login to save this paper or follow this series

Imperfect Monitoring of Monitoring Agents: One Reason Why Hierarchies Can Be Superior to "Lean" Organizations

Contents:

Author Info

  • Kirstein, Roland

Abstract

Effective monitoring requires proper incentives and detection skill. Detection skills depend on the extent of specialization in monitoring and on the number of agents to be supervised. This paper demonstrates that hierarchy and monitoring of monitors can provide the necessary incentives for the monitoring agents, which induces them to make use of their detection skill. The model draws on the theory of imperfect diagnosis and explains why hierarchies can be superior to ?lean? organizations. -- Wirksames Monitoring erfordert nicht nur angemessene Anreize, sondern auch Überwachungsfähigkeit. Diese hängt von der Spezialisierung auf Monitoring ab, aber auch von der Zahl der zu überwachenden Agenten. In diesem Beitrag wird gezeigt, dass die Einrichtung einer Hierarchie es erlaubt, Monitoren zu überwachen, um ihnen die nötigen Anreize zu vermitteln kann, ihre Überwachungsfähigkeit zu nutzen. Das Modell nutzt die Theorie imperfekter Diagnosen und erklärt, warum Hierarchien im Vergleich zu ?lean organizations? überlegen sein können.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://econstor.eu/bitstream/10419/23038/1/2003-07_monitoring.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Saarland University, CSLE - Center for the Study of Law and Economics in its series CSLE Discussion Paper Series with number 2003-07.

as in new window
Length:
Date of creation: 2003
Date of revision:
Handle: RePEc:zbw:csledp:200307

Contact details of provider:
Postal: Postfach 151150, 66041 Saarbrücken
Phone: *49(0)681-302 2132
Fax: *49(0)681-302 3591
Email:
Web page: http://www.uni-saarland.de/fak1/fr12/csle/
More information through EDIRC

Related research

Keywords: Hierarchy; Imperfect Diagnosis; Monitoring; Incentives;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Gary S. Becker & George J. Stigler, 1974. "Law Enforcement, Malfeasance, and Compensation of Enforcers," The Journal of Legal Studies, University of Chicago Press, University of Chicago Press, vol. 3(1), pages 1-18, January.
  2. Kandel, E. & Lazear, E.P., 1990. "Peer Pressure and Partnerships," Papers, Rochester, Business - Managerial Economics Research Center 90-07, Rochester, Business - Managerial Economics Research Center.
  3. Langlois,Richard, 1989. "Economics as a Process," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521378598.
  4. Heiner, Ronald A, 1985. "Origin of Predictable Behavior: Further Modeling and Applications," American Economic Review, American Economic Association, American Economic Association, vol. 75(2), pages 391-96, May.
  5. Ronald Heiner, 1990. "Rule-governed behavior in evolution and human society," Constitutional Political Economy, Springer, Springer, vol. 1(1), pages 19-46, December.
  6. Kessler, Anke S., 2000. "On Monitoring and Collusion in Hierarchies," Journal of Economic Theory, Elsevier, Elsevier, vol. 91(2), pages 280-291, April.
  7. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 76, pages 169.
  8. Daniel Nagin & James Rebitzer & Seth Sanders & Lowell Taylor, 2002. "Monitoring, Motivation and Management: The Determinants of Opportunistic Behavior in a Field Experiment," NBER Working Papers 8811, National Bureau of Economic Research, Inc.
  9. Heiner, Ronald A, 1983. "The Origin of Predictable Behavior," American Economic Review, American Economic Association, American Economic Association, vol. 73(4), pages 560-95, September.
  10. Tirole, Jean, 1986. "Hierarchies and Bureaucracies: On the Role of Collusion in Organizations," Journal of Law, Economics and Organization, Oxford University Press, Oxford University Press, vol. 2(2), pages 181-214, Fall.
  11. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, Elsevier, vol. 3(4), pages 305-360, October.
  12. Kirstein, Roland, 2000. "The New Basle Accord, Internal Ratings, and the Incentives of Banks," CSLE Discussion Paper Series, Saarland University, CSLE - Center for the Study of Law and Economics 2000-06, Saarland University, CSLE - Center for the Study of Law and Economics.
  13. Strausz, Roland, 1999. "Efficiency in Sequential Partnerships," Journal of Economic Theory, Elsevier, Elsevier, vol. 85(1), pages 140-156, March.
  14. Demski, Joel S. & Sappington, David, 1984. "Optimal incentive contracts with multiple agents," Journal of Economic Theory, Elsevier, Elsevier, vol. 33(1), pages 152-171, June.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:zbw:csledp:200307. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.