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Now THAT’s a Principal-Agent Problem
| Lasse Lien |
The Swedish secret service has caused quite an uproar recently. Following a difficult year, the Chief of the agency decided to spend 5 million Swedish kroner on a James Bond themed (!) party to boost the morale among its 1,000 employees. That sum amounts to more than 750 USD per agent-slash-employee for one single party. The principals — the Swedish taxpayers — seem to think that this was way over the top, and evidence of imperfect interest alignment and agents acting in their self interest. Jokesters have also pointed out that if they had thrown a STASI or KGB-themed party instead, it would have been a tad less glamorous, but spending could have been more in line with the principals’ interests. I don’t know, but perhaps the Swedes will have to invest more in monitoring their monitors.
Filed under: - Lien -, Ephemera, Public Policy / Political Economy, Theory of the Firm 
2012-09-01 11:39:43
Source: http://organizationsandmarkets.com/2012/09/01/now-thats-a-principal-agent-problem/
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