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Putting Agency and Integrity to the Test
Author(s) -
Arce Daniel G.
Publication year - 2011
Publication title -
southern economic journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.762
H-Index - 58
eISSN - 2325-8012
pISSN - 0038-4038
DOI - 10.4284/0038-4038-77.4.843
Subject(s) - agency (philosophy) , corporate governance , business , competition (biology) , principal (computer security) , principal–agent problem , law and economics , value (mathematics) , agency cost , test (biology) , matching (statistics) , industrial organization , economics , computer security , computer science , sociology , ecology , social science , paleontology , finance , machine learning , biology , shareholder , statistics , mathematics
This article examines recent claims about the necessity of integrity in agency relationships by putting agents with preferences that reflect integrity in an evolutionary competition with opportunistic agents. Corporate culture is modeled through a process of assortative matching between principal and agent types (via industry or group effects). This leads to a characterization of corporate governance where integrity is linked with value creation.