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| Volume2,
No. 3,
December
2003 |
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On
Incentives for an Efficient Flow of Knowledge
within Multinationals |
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Amir Shoham |
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Department of Business Administration,
Ben-Gurion University, Israel
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Negev Academic College of Engineering, Israel |
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Varda Lewinstein Yaari and David M. Brock |
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Department of Business Administration, Ben-Gurion University, Israel |
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Abstract |
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In this paper we develop a principal-agent, game-theoretic model
of an MNC, intended to add to the understanding of how smart
choices between incentives, monitoring, and structures are linked
to an effective intra-firm flow of knowledge. We find that the
equilibrium depends on the efficiency of substituting incentives
for monitoring. Our study sheds light on arguments within the
international management field about monitoring, incentives for
managers, and managing knowledge transfer between subsidiaries. |
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Key words:
multinational; incentives; monitoring
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| JEL
classification:
F23;
M10;
M20 |
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