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The Controllability Principle in Responsibility Accounting: Another Look In this paper, we illustrate some subtleties in responsibility accounting by studying settings in which there is an interplay between different control problems. In a setting in which agents are involved in both team and individual production, we provide conditions under which the(More)
This paper studies implementation in a principal-agent model of adverse selection. We explore ways in which the additional structure of principal-agent models (compared to general implementation models) simplifies the implementation problem. We develop a connection between the single crossing property and monotonicity conditions which are necessary for Nash(More)
Firms routinely decide whether to make essential inputs themselves or buy the inputs from independent suppliers. Conventional wisdom suggests that a firm will not buy an input for a price above its in-house cost of production. We show that this is not necessarily the case when a monopolistic input supplier also serves the firm's retail rival. In this case,(More)
Abstr act. Firms often use both objective/verifiable and subjective/non-verifiable performance measures to provide employees with effort incentives. We study a principal/multi-agent model in which a verifiable team-based performance measure and non-verifiable individual performance measures (one for each agent) are available for contracting. A problem with(More)