Incentives and the Delegation of Decision Making Power in Sovereign Wealth Funds
The paper models the incentives of a politician to delegate the decision making power in a sovereign wealth fund to an independent external manager. It formalizes the learning-e¤ects as well as the increase of transparency of the SWF and the rise of investment possibilities associated with higher transparency. It also focuses on the role of elections as a basic mechanism to control and discipline politicians. I show that the politician has incentives for strategic behaviour if voters have incomplete information about his competence. The paper also studies when the delegation of decision making power is socially optimal and under which circumstances it takes place.
|Date of creation:||2011|
|Date of revision:|
|Publication status:||Forthcoming in|
|Contact details of provider:|| Postal: Universitätsstraße 25, 35037 Marburg|
Web page: http://www.uni-marburg.de/fb02/
More information through EDIRC
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.:
- Edwin M. Truman, 2009.
"A Blueprint for Sovereign Wealth Fund Best Practices,"
Revue d'Économie Financière,
Programme National Persée, vol. 9(1), pages 429-451.
- Edwin M. Truman, 2008. "A Blueprint for Sovereign Wealth Fund Best Practices," Policy Briefs PB08-3, Peterson Institute for International Economics.
- Eric Le Borgne & Gauti B. Eggertsson, 2007. "Dynamic Incentives and the Optimal Delegation of Political Power," IMF Working Papers 07/91, International Monetary Fund.
- William L. Megginson & Bernardo Bortolotti & Veljko Fotak & William Miracky, 2009. "Sovereign Wealth Fund Investment Patterns and Performance," Working Papers 2009.22, Fondazione Eni Enrico Mattei.
When requesting a correction, please mention this item's handle: RePEc:mar:magkse:201117. 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: (Bernd Hayo)
If references are entirely missing, you can add them using this form.