108536 20230519145410.0 doi 10.3390/e23080957 sideral 125202 ART-2021-125202 eng Gutiérrez, Oscar Agency Contracts under Maximum-Entropy 2021 Access copy available to the general public Unrestricted This article proposes the application of the maximum-entropy principle (MEP) to agency contracting (where a principal hires an agent to make decisions on their behalf) in situations where the principal and agent only have partial knowledge on the probability distribution of the output conditioned on the agent’s actions. The paper characterizes the second-best agency contract from a maximum entropy distribution (MED) obtained from applying the MEP to the agency situation consistently with the information available. We show that, with the minimum shared information about the output distribution for the agency relationship to take place, the second-best compensation contract is (a monotone transformation of) an increasing affine function of output. With additional information on the output distribution, the second-best optimal contracts can be more complex. The second-best contracts obtained theoretically from the MEP cover many compensation schemes observed in real agency relationships. info:eu-repo/grantAgreement/ES/MINECO-FEDER/ECO2017- 86305-C4-3-R info:eu-repo/semantics/openAccess by http://creativecommons.org/licenses/by/3.0/es/ 2.738 2021 PHYSICS, MULTIDISCIPLINARY 42 / 86 = 0.488 2021 Q2 T2 0.553 2021 Electrical and Electronic Engineering 2021 Q2 Physics and Astronomy (miscellaneous) 2021 Q2 Information Systems 2021 Q2 4.4 2021 info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion Salas-Fumás, Vicente Universidad de Zaragoza (orcid)0000-0001-8405-1056 4012 650 Universidad de Zaragoza Dpto. Direcc.Organiza.Empresas Área Organización de Empresas 23, 8 (2021), e957 [17 pp.] Entropy ENTROPY 1099-4300 1335569 http://zaguan.unizar.es/record/108536/files/texto_completo.pdf Versión publicada 2685591 http://zaguan.unizar.es/record/108536/files/texto_completo.jpg?subformat=icon icon Versión publicada oai:zaguan.unizar.es:108536 articulos driver 2023-05-18-13:54:36 ARTICLE