Self-Interest through Delegation: An Additional Rationale for the Principal-Agent Relationship

By John R. Hamman, George Loewenstein, Roberto A. Weber. 2010

370 citations recorded by the source corpus.

Principal-agent relationships are typically assumed to be motivated by efficiency gains from comparative advantage. However, principals may also delegate tasks to avoid taking direct responsibility for selfish or unethical behavior. We report three laboratory experiments in which principals repeatedly either decide how much money to share with a recipient or hire agents to make sharing decisions on their behalf. Across several experimental treatments, recipients receive significantly less, and in many cases close to nothing, when allocation decisions are made by agents. (JEL D82)

Subfields: General Decision Sciences, Management Science and Operations Research, Safety Research

View Paper: https://www.semanticscholar.org/paper/d5f6d77a5631f40c39cc8fafe7bb284080a4e179

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Citations in the corpus

Excusing Selfishness in Charitable Giving (2015, background): “…Bernheim, 2009; Linardi and McConnell, 2011; Falk and Szech, 2013).5 People also achieve more selfish outcomes by delegating decisions to others (Hamman et al., 2010; Coffman, 2011; Bartling and Fischbacher, 2012), or by avoiding situations that involve giving decisions (Dana et al., 2006;…”
Identity, morals, and taboos: beliefs as assets. (2011, background): “Hamman, Loewenstein, and Weber (2010) show that recipients in dictator games receive much less when principals have the optiontodelegatethesharingdecisiontoa thirdparty.”
Individual and Corporate Social Responsibility (2010, background): “In a related vein, Hamman et al. (2009) show that many subjects who would otherwise behave generously in a dictator game will, given the opportunity, delegate the sharing decision to a third party who has acquired a reputation for being biased in favour of delegating principals.”
Looking for Someone to Blame: Delegation, Cognitive Dissonance, and the Disposition Effect (2014, neutral): “Hamman et al. (2010) and Bartling and Fischbacher (2012), and the discussion in Section 2).”
The Control Premium: A Preference for Payoff Autonomy † (2014, result): “In contrast to recent studies showing how the use of intermediation to shift blame for a harmful decision can reinforce the agency relationship (Bartling and Fischbacher 2011, Coffman 2011, Grossman and Oexl 2011, Hamman et al. 2010), we highlight a factor that undermines it.”