lecture 6

Question 1

what is the overlap of variables for workers benefit and firm benefit

Answer 1

Assets and worker ambiguity

Question 2

autonomy and assets are related

Answer 2

If yoiu have higher autonomy, you get higher effort.

if you give lamda = 0.5, with lower Project relevant capital you wille get lower effort,

if you lower lamda even more you get even lower effort unless you compensate with more project relevant capital

Question 3

lower Project relevant capital

Answer 3

when facing severe motivational concerns - which is the case for lowe PRC - managers delegate more to mitigate agency costs and induce greater effort

Question 4

Higher PRC

Answer 4

given that high PRC motivates the researcher and motivational concerns are only modest. The firm benefits from delegating in higher-PRC projects due to greater effectiveness of informed decisions made by the researcher

Question 5

Both low and high PRC pushes for more delegation (autonomy)

Answer 5

For low PRC it pushes for more autonomy due to motivational purposes, whereas high PRC pushes for more delegation due to efficiency consideration