Decision Analysis and the Principal-Agent Problem
Economics, Finance, & Quantitative Analysis
The article discusses the classroom lecture that improves the traditional instruction in decision analysis by relating decision making under risk to the principal-agent problem. The baseline decision scenario is examined both from the perspective of a firm desiring to maximize the expected profit and from the perspective of a risk-averse manager desiring to maximize the expected utility. The article also provides students' assessments regarding the effectiveness of the lecture.
Decision Sciences: Journal of Innovative Education
Digital Object Identifier (DOI)
Katzman, Brett E., Penny Verhoeven, and Hope M. Baker. "Decision Analysis and the Principal–Agent Problem." Decision Sciences Journal of Innovative Education 7.1 (2009): 51-57.