Negotiating incomplete contracts

When planning is possible, as in predictive environments, comprehensive contracting is not only desirable, but also useful. However, under conditions of fundamental uncertainty, as is the case in non-predictive environments, incomplete contracting approaches likely prevail. In this study, we explore how trust in such environments affects the way in which venturing professionals negotiate, and how the outcome subsequently manifests itself in the negotiated agreement. In particular, building upon a sample of Norwegian firms, we find that stewardship relationships are more prone to incomplete contracting approaches than agency relationships, paving the way for a relational approach to contracting when uncertainty is high. Implications for theory and practice are discussed.

The Role of Neuroaccounting (the Science of Neural-based Accounting) in Decision Making

The present study aims to determine the role of neuroaccounting in decision making. The data collection method is conducted by using interviews, moreover, the data analysis is analyzed by administering the interpretation of subjective understanding of informants which then followed by researchers' reflexivity. The results suggest that principal-agent relationships can occur when the legislature and the executive establish agency relationships in the policy-making process. In the perception of neuroscience; the interest of interest, the limited time of office, the inclination and limitation of knowledge to know all the public needs can be imprinted and settled in the brain, thus, it can create moral hazard and adverse selection of behavior.

Maduro Bonds

For multiple decades, activists have sought to institute an international legal regime that limits the ability of despotic governments to borrow money and then shift those obligations onto more democratic successor governments. The goal of this chapter is to raise the possibility of an alternate legal path to raising the costs of borrowing for despotic regimes. All countries have systems of domestic laws that regulate agency relationships and try to deter corruption; otherwise the domestic economy would not function. Despotic governments are especially likely to engage in transactions that are legally problematic, since by definition, they lack the support of the populace; meaning that there is a high likelihood that actions that they take on behalf of the populace can be challenged as unrepresentative and contrary to the interests of the true principals. The foregoing conditions, if one translates them into the context of an ordinary principal–agent relationship, would constitute a voidable transaction in most modern legal systems. That means that if opposition parties in countries with despotic governments today were to monitor and make public the potential problems with debt issuances by their despotic rulers under their own local laws, it would raise the cost of capital for those despots. To support our argument, we use both the concrete example of the debt issuance shenanigans of the Maduro government in Venezuela and a more general analysis of the relationship between corruption, democracy, and a nation’s borrowing costs.

An Evaluation of the Effects of Social Media on Client

High level of informality in the relationship between brand managers and advertising account representatives has been described as factor affecting positive work dynamic and long – term success. Although means of informal communications such as emails are still used, social networks have been gaining increasing popularity in the business landscape. This paper examines the effects of social media on client – agency relationships with focus on Facebook as an example of personal network. The methodology combines primary and secondary research. The paper reviews literature on client – agency relationships and social media, which provide the foundation for primary research. The paper concludes that connecting on Facebook with a client or agency representative is a way of showing the relationship has moved beyond strictly a working one. However, connecting with a work contact on Facebook should not be done in order to make the work relationship stronger. The study offers recommendations for practitioners and direction for future research.