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Edward Kane

During the last 20 years, concepts taken from the fields of corporate finance and efficient contracting have thrown new light on issues of bank regulation. Corporate finance theory portrays regulation as a multiparty chain of asymmetrically informed principal-agent relationships (e.g., Kane, 1999 ). Optimal-contracting theory emphasizes the desirability of minimizing the coordination costs that these multiparty chains of agency contracts generate ( Jensen and Meckling, 1975 ). Applying these ideas to the case of a monopoly regulator faithfully

Boriana Yontcheva
This paper presents a dynamic game of strategic delegation between a principal and an agent. The principal can choose between two organizational designs: a traditional hierarchy where she retains authority over the choice of projects to be implemented or a delegation where she allows her agent to select the project. The key objectives of this model are to identify the long-run determinants of the principal’s choice and verify the impact of the authority allocation on the agent’s effort levels and on the principal’s payoffs. We apply the model to the relationships between institutional donors and nongovernmental organizations.
Bradley Jones

Front Matter Page Monetary and Capital Markets Department Contents Abstract I. Introduction II. Institutional Asset Owners – Taxonomy and Data Description III. Asset Owners and Asset Allocation Changes: Pro—or Countercyclical? IV. A Framework for Long-term, Countercyclical Investment A. Strengthening Governance B. Benchmarks, Factor Tilts and Rebalancing C. Risk Management—A Symmetric Approach to Shortfall Risk D. Realigning the Principal—Agent Relationship E. Mitigating Procyclical Regulation V. Conclusion References

A. Premchand

economics of organizations. The answers to these issues vary. Broadly, however, they may be considered here under (1) traditional organizational techniques; (2) principal-agent relationships; (3) improved organizational design through information systems; and (4) overall organizational development. The theory, its relevance, and general experience are considered for each area. T raditional O rganizational T echniques The need to improve an organization’s management to ensure it complies with the goals specified has always been at the forefront of organizational

William Dillinger and Marianne Fay

-effective to contract with local governments to carry out field-office functions on its behalf. A successful division of functions is therefore often characterized as a complicated set of principal-agent relationships, in which subnational governments act both as agents of higher levels of government and as principals (or, more precisely, as agents of their own constituents) in the delivery of local services. To accomplish this, individual services are often unbundled, with each level of government performing the role that best reflects its interest or comparative