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Firm Size And Monitoring

Author

Listed:
  • Cheryl Long

    (Colgate University)

  • Richard Boylan

    (Culver College of Commerce and Business Administration, University of Alabama)

Abstract

We present a model of optimal monitoring expenditures. For any technology that yields a conventional ``S-shaped''' production function for monitoring, the optimal level of monitoring is shown to be higher in medium-sized firms than in both small and large firms. Further, the interaction between specialization and agency are shown to lead to an ``S-shaped'''' production function.

Suggested Citation

  • Cheryl Long & Richard Boylan, 2003. "Firm Size And Monitoring," Economics Bulletin, AccessEcon, vol. 4(34), pages 1-5.
    • Handle: RePEc:ebl:ecbull:eb-03d20002
    as

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    File URL: http://www.accessecon.com/pubs/EB/2003/Volume4/EB-03D20002A.pdf
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    References listed on IDEAS

    as
    1. George J. Stigler, 1962. "Information in the Labor Market," NBER Chapters, in: Investment in Human Beings, pages 94-105, National Bureau of Economic Research, Inc.
    2. Neal, Derek, 1993. "Supervision and Wages across Industries," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 409-417, August.
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    More about this item

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

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