Principal (commercial law)

About: Principal (commercial law) is a research topic. Over the lifetime, 1579 publications have been published within this topic receiving 35379 citations. The topic is also known as: Principal (commercial law).

Agency and the organization of health care delivery.

Abstract: Recent developments in the theory of agency--the relationship that arises e when a principal delegates authority to an agent--offer powerful insights into the organization of health care delivery systems. In this paper we first provide an overview of the agency literature and then illustrate how relationships between doctors, patients, and hospitals can be explored within an agency framework. We find that not only the evolution of standard fee-for-service relationships but also the emergence of HMOs can be analyzed as responses to uncertainty and to difficulties in writing complete, enforceable contracts. These findings have broad implications for health policy and suggest a variety of strategies for addressing agency issues.

The economics of organized crime and optimal law enforcement

Abstract: This article extends the optimal law enforcement literature to organized crime. I model the criminal organization as a vertical structure where the principal extracts some rents from the agents through extortion. As long as extortion is a costless transfer from individuals to the criminal organization, not only the existence of extortion is social welfare improving because it makes engaging in a criminal offense less attractive but it also allows the government to reduce expenditures on law enforcement. When extortion is costly because the criminal organization resorts to threats and violence, the existence of extortion is social welfare diminishing and may lead to higher expenditures on law enforcement.

Administrative Law Goes to War

Abstract: What are the President's war-making powers? This essay, a brief reply to an article by Curtis Bradley and Jack Goldsmith, contends that the answer lies in administrative law, at least in the first instance. The President's authority often depends on what Congress has said, and under established principles, the President has a great deal of power to interpret ambiguities in congressional enactments - in war no less than in peace. The principal qualifications involve interpretive principles, also found in administrative law, that call for a narrow construction of presidential authority to invade constitutionally sensitive interests. The relevant arguments are illustrated throughout with reference to the 2001 authorization for the use of military force in response to the attacks of September 11; the authorization may or may not include the power to make war on Iraq and Afghanistan, to use force against those suspected of giving financial aid to terrorist organizations, and to detain American citizens.

The Wrong Kind of Transparency

Abstract: In a model of career concerns for experts, when is a principal hurt from observing more information about their agent? This Paper introduces a distinction between information on the consequence of the agent's action and information directly on the agent's action. When the latter kind of information is available, the agent faces an incentive to disregard useful private signals and act according to how an able agent is expected to act a priori. This conformist behaviour hurts the principal in two ways: the decision made by the agent is less likely to be the right one (discipline) and ex post it is more difficult to evaluate the agent's ability (sorting). The Paper identifies a necessary and sufficient condition on the agent signal structure under which transparency on action is detrimental to the principal. The Paper also shows the existence of complementarities between transparency on action and transparency on consequence. The results on the distinction between transparency on action and transparency on consequence are then used to interpret existing disclosure policies in politics, corporate governance, and delegated portfolio management.