Access the full text.
Sign up today, get DeepDyve free for 14 days.
Gerald Feltham, Jim Xie (2007)
Performance Measure Congruity and Diversity in Multi-Task Principal/Agent Relations
S. Dutta, Frank Gigler (2002)
The Effect of Earnings Forecasts on Earnings ManagementJournal of Accounting Research, 40
S. Kim (1995)
Efficiency of an Information System in an Agency ModelEconometrica, 63
F. Larmande (2013)
Limited Liability, the First-Order Approach, and the Ranking of Information Systems in AgenciesEconomics Letters, 118
D. Fudenberg, J. Tirole (1990)
Moral Hazard and Renegotiation in Agency ContractsEconometrica, 58
Paul Milgrom, John Roberts (1988)
An Economic Approach to Influence Activities in OrganizationsAmerican Journal of Sociology, 94
J. Ponssard, F. Larmande (2008)
Implementation of an EVA compensation scheme
B. MacLeod (2003)
Optimal contracting with subjective evaluationThe American Economic Review, 93
M. Vartiainen, C. Antoni, X. Baeten, N. Hakonen, R. Lucas, H. Thierry (2008)
Reward management - facts and trends in Europe
Joel Demski (1998)
Performance Measure ManipulationContemporary Accounting Research, 15
W. Macleod (2001)
On Optimal Contracting with Subjective EvaluationOrganizations & Markets eJournal
Anil Arya, Jonathan Glover (2008)
Performance measurement manipulation: cherry-picking what to correctReview of Accounting Studies, 13
Joel Demski, Hans Frimor, D. Sappington (2004)
Efficient Manipulation in a Repeated SettingLabor: Personnel Economics
We study a principal–agent model in which the agent can provide ex post additional relevant information regarding his performance. In particular, he can provide a legitimate excuse, that is, evidence that a poor result is only due to factors outside his control. However, building a convincing case requires time, time that is not spent on exerting productive effort and thus generating information represents an opportunity cost. We obtain necessary and sufficient conditions for the principal to prefer a policy of adjusting ex post the performance measure for the information provided by the agent to a policy of conforming to a result-based system with no adjustments. The risk aversion and a possible limited liability of the agent play an important role in the analysis. This paper clarifies the issues associated with the so-called “excuse culture” prevailing in some organizations.
Review of Accounting Studies – Springer Journals
Published: Jan 28, 2014
Read and print from thousands of top scholarly journals.
Already have an account? Log in
Bookmark this article. You can see your Bookmarks on your DeepDyve Library.
To save an article, log in first, or sign up for a DeepDyve account if you don’t already have one.
Copy and paste the desired citation format or use the link below to download a file formatted for EndNote
Access the full text.
Sign up today, get DeepDyve free for 14 days.
All DeepDyve websites use cookies to improve your online experience. They were placed on your computer when you launched this website. You can change your cookie settings through your browser.