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» Personal Loan No Credit Check, Online Economics » Management » Topics begins with W » Weitzman pattern
The Weitzman pattern also Soviet incentive pattern is an incentive pattern of which the truthful reporting of managers to management to ensure is.
The initial reflection is that the manager exactly knows about the future enterprise situation and thus about the attainable surplus, management however not. The Weitzman pattern aims now at the remuneration of the manager starting from which to the size which can be reported x^* is coupled.
For the manager it is thus optimal the true value, acceptance in accordance with which it admits is to call. He should say a smaller value it a premium subsidy would receive, this would be he however smaller than the premium which he would receive if he the truth would report.
The pattern can lead it to wrong incentives if knappe money for investments gives and the expected profits is unevenly distributed over the necessary investment quantities. Example:
For manager A it can now be rational the data to the net yields to modify in such a way that it reports an even net yield, thus net yield A1 lowers, but net yield a2 raises over RB to over always be. With further truthful report of B it will receive now higher financial means and will increase thus its premium. For the center also at expiration of the Investionsperiode the report will appear as truthful, since the total net yield of A1 and a2 corresponds to the average reported by A.
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