| Original language | English |
|---|---|
| Title of host publication | Encyclopedia of Business and Professional Ethics |
| Editors | Deborah C Poff, Alex C. Michalos |
| Place of Publication | online |
| Publisher | Springer Cham |
| Volume | 1 |
| ISBN (Print) | 978-3-319-23514-1 |
| DOIs | |
| Publication status | Published - 2018 |
Abstract
Agency theory is concerned with problems that arise where one party (the agent) is expected to act in the interests of another party (the principal), but the agents own interests may conflict with the principals interests, and the principal cannot fully monitor and discipline the agent. Agency theory is widely referenced in business, economics, and political science, where it is often identified as the principal-agent problem. In business applications, the emphasis is usually on agency costs, which are the costs borne by either the agent or the principal as a consequence of agency problems.