{
  "title": "Trust As a Means of Improving Corporate Governance and Efficiency",
  "publication": "IMF Working Papers, February 1, 2002",
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  "summary": "Agency problems within the firm are a significant hindrance to efficiency. We propose trust between coworkers as a superior alternative to the standard tools used to mitigate agency problems: increased monitoring and incentive-based pay.",
  "sections": [
    {
      "heading": "Summary and core findings",
      "content": "- Agency problems within the firm are a significant hindrance to efficiency.\n- The paper proposes trust between coworkers as a superior alternative to the standard tools used to mitigate agency problems: increased monitoring and incentive-based pay.\n- Trust induces employees to work harder, relative to those at firms that use the standard tools.\n- Employees at trusting firms have higher job satisfaction.\n- Trusting firms enjoy lower labor cost and higher profits.\n- Trust may also be easier to use within the firm than the standard agency-mitigation tools."
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      "heading": "Analytical focus and themes",
      "content": "- Examination of agency problems within firms and comparative effectiveness of mitigation mechanisms.\n- Comparison of trust-based governance to:\n  - increased monitoring, and\n  - incentive-based pay.\n- Outcomes assessed include worker effort, job satisfaction, labor costs, and firm profits.\n- Concepts and keywords emphasized in the paper: asymmetric information, company loyalty, corporate governance, efficiency, moral hazard, nonaltruistic firm, profit sharing, shareholder-employee agency relationship, trust, wage contract, Wages.\n\n---\n\n Content in this bundle\n\n- 129721\n  - 129721 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - 129721 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/trust-as-a-means-of-improving-corporate-governance-and-efficiency-15658"
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    "Authors: Ralph Chami, Connel Fullenkamp",
    "Published: February 1, 2002",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451845198.001",
    "Agency problems within the firm are a significant hindrance to efficiency.",
    "The paper proposes trust between coworkers as a superior alternative to the standard tools used to mitigate agency problems: increased monitoring and incentive-based pay.",
    "Trust induces employees to work harder, relative to those at firms that use the standard tools.",
    "Employees at trusting firms have higher job satisfaction.",
    "Trusting firms enjoy lower labor cost and higher profits.",
    "Trust may also be easier to use within the firm than the standard agency-mitigation tools.",
    "Examination of agency problems within firms and comparative effectiveness of mitigation mechanisms.",
    "Comparison of trust-based governance to:",
    "Outcomes assessed include worker effort, job satisfaction, labor costs, and firm profits.",
    "Concepts and keywords emphasized in the paper: asymmetric information, company loyalty, corporate governance, efficiency, moral hazard, nonaltruistic firm, profit sharing, shareholder-employee agency relationship, trust, wage contract, Wages.",
    "**129721**"
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