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The Corporate Governance of Benedictine Abbeys: What can Stock Corporations Learn from Monasteries?

Author

Listed:
  • Katja Rost
  • Emil Inauen
  • Margit Osterloh
  • Bruno S. Frey

Abstract

The corporate governance structure of monasteries is analyzed to derive new insights into solving agency problems of modern corporations. In the long history of monasteries, some abbots and monks lined their own pockets and monasteries were undisciplined. Monasteries developed special systems to check these excesses and therefore were able to survive for centuries. These features are studied from an economic perspective. Benedictine monasteries in Baden-W�rttemberg, Bavaria and German speaking Switzerland have an average lifetime of almost 500 years and only a quarter of them broke up as a result of agency problems. We argue that this is due to an appropriate governance structure, relying strongly on the intrinsic motivation of the members and on internal control mechanisms.

Suggested Citation

  • Katja Rost & Emil Inauen & Margit Osterloh & Bruno S. Frey, 2008. "The Corporate Governance of Benedictine Abbeys: What can Stock Corporations Learn from Monasteries?," IEW - Working Papers 374, Institute for Empirical Research in Economics - University of Zurich.
  • Handle: RePEc:zur:iewwpx:374
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    File URL: http://www.econ.uzh.ch/static/wp_iew/iewwp374.pdf
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    Cited by:

    1. Bell, Adrian & Sutcliffe, Charles, 2010. "Valuing medieval annuities: Were corrodies underpriced?," Explorations in Economic History, Elsevier, vol. 47(2), pages 142-157, April.
    2. Peter Wirtz & Odile Paulus & Patrice Charlier, 2011. "Gouvernance et création de valeur cognitive : L'exemple de l'ordre des prêcheurs," Post-Print halshs-00642977, HAL.
    3. Peter Wirtz, 2013. "Gouvernance et efficacité missionnaire de la Compagnie de Jésus : les enseignements d'une théorie élargie de la gouvernance," Working Papers halshs-00862068, HAL.
    4. Peter Wirtz, 2014. "Governance and missionary effectiveness of the Company of Jesus: lessons from an extended theory of governance," Post-Print hal-00974337, HAL.
    5. Peter Wirtz & Odile Paulus & Patrice Charlier, 2012. "La gouvernance des Dominicains au-delà des théories établies," Working Papers halshs-00691233, HAL.
    6. Beckmann Klaus & Gerrits Carsten, 2009. "Armutsbekämpfung durch Reduktion von Korruption: eine Rolle für Unternehmen? / Fighting poverty by fighting corruption: A task for private enterprise?," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 60(1), pages 463-494, January.
    7. Bruno S. Frey & Stephan Rothlin, 2015. "Catholic Orders as Efficient Institutions," CREMA Working Paper Series 2015-12, Center for Research in Economics, Management and the Arts (CREMA).

    More about this item

    Keywords

    Corporate Governance; Principal-Agency-Theory; Psychological Economics; Monasteries; Benedictine Order;

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • G3 - Financial Economics - - Corporate Finance and Governance
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • Z12 - Other Special Topics - - Cultural Economics - - - Religion

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