Managerial incentives as a strategic variable in duopolistic environment

doi:10.1016/0167-7187(85)90007-4

International Journal of Industrial Organization

Volume 3, Issue 2, June 1985, Pages 245-253

https://doi.org/10.1016/0167-7187(85)90007-4 Get rights and content

Abstract

The paper investigates two interrelated problems. The first is the output choice of a firm in which decisions are made cooperatively by managers who might have conflicting objectives. The second is the managerial incentives scheme as a strategic choice of owners who wish to maximize profits. Using an example in which a duopolistic market is studied, the paper shows that giving managers incentives that combine profit and sales maximization might be the dominant strategy for the owners.

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^∗: I wish to thank Eitan Muller, Gery Goldstein and three anonymous referees for their helpful comments.

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Managerial incentives as a strategic variable in duopolistic environment

Abstract

International Journal of Industrial Organization

A model of the firm as a stockholder employee cooperative game

American Economic Review

Equilibrium growth of the hierarchical firm: Cooperative game approach

American Economic Review

On the theory of oligopoly

Economica

Behavioral theory of the firm

Oligopoly and the theory of games