Managing multinational corporations through compensation: The risk-sharing contract method

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• 作者：Amir Shoham ; ^{amir1s@colman.acil} ; ^{tud20698@temple.edu}
• 关键词：F23 ; C70 ; M12 ; M16 ; M21
• 刊名：Journal of Economics and Business
• 出版年：2012
• 期刊代码：45_01486195
• 类别：bus
• 出版时间：May-June, 2012
• 卷：64
• 期：3
• 页码：231-239
• 文件大小：330 K

摘要

This paper presents a mechanism that supports the flows of resources between subsidiaries of multinational companies. The mechanism is based on a risk-sharing contract between the HQ and the subsidiary manager. The model is built on the assumption that there are two alternative supervisory methods for promoting the flow of resources: incentives and direct monitoring. Analysis of the model leads to several interesting results, including some situations in which the manager of a subsidiary will be overcompensated. Another result indicates that as the distance between the home country and the host country increases, the incentive to the subsidiary manager increases.