JOURNAL BROWSE
Search
Advanced SearchSearch Tips
Analysis of the Supervision of Ecological Subsidies: Based on the Principal-agent Model
facebook(new window)  Pirnt(new window) E-mail(new window) Excel Download
  • Journal title : Environmental Engineering Research
  • Volume 19, Issue 4,  2014, pp.369-373
  • Publisher : Korean Society of Environmental Engineering
  • DOI : 10.4491/eer.2014.058
 Title & Authors
Analysis of the Supervision of Ecological Subsidies: Based on the Principal-agent Model
Zhang, Yuesheng;
  PDF(new window)
 Abstract
In view of the problem of the invalidity of the incentive mechanism of the ecological subsidies, which is due to the information asymmetry between the government`s supervision and the enterprise endeavor to fulfill their ecological responsibilities, this paper attempts to analyze the supervision of ecological subsidies based on the Principal-agent Model. Two conclusions are drawn: firstly, the government`s supervision regarding the effect of the enterprises` fulfilling the ecological responsibilities can significantly reduce the information asymmetry; secondly, the government`s incentive strength and the enterprises` endeavor level of fulfilling the ecological responsibilities are both improving the surveillance dynamics. Here is the suggestion: with the increasing of the surveillance dynamics of the government and the transparency of the enterprises` fulfilling the ecological responsibilities, the government should meanwhile increase the subsidies incentive strength, therefore, to promote the effort level of the enterprises` fulfilling the ecological responsibilities to approach to the Pareto optimal value.
 Keywords
Ecological subsidies;Information asymmetry;Principal-agent model;Supervision;
 Language
English
 Cited by
 References
1.
Kagan RA, Gunningham N, Thornton D. Explaining corporate environmental performance: how does regulation matter? Law Soc. Rev. 2003;37:51-90. crossref(new window)

2.
Doonan J, Lanoie P, Laplante B. Determinants of environmental performance in the Canadian pulp and paper industry: an assessment from inside the industry. Ecol. Econ. 2005;55:73-84. crossref(new window)

3.
Delmas MA, Toffel MW. Organizational responses to environmental demands: opening the black box. Strategic Manage. J. 2008;29:1027-1055. crossref(new window)

4.
Mirrless J. Notes on welfare economies, information and uncertainty. In: Michael Balch, Daniel McFadden and Shif-yen Wu, eds. Essays on economic behavior under uncertainty. Amsterdam: North-Holland; 1974.

5.
Mirrless JA. The optimal structure of authority and incentives within an organization. Bell J. Econ. 1976;7:105-131. crossref(new window)

6.
Holmstrom B. Moral hazard in teams. Bell J. Econ. 1982;13:324-340. crossref(new window)

7.
Theilen B. Simultaneous moral hazard and adverse selection with risk agents. Econ. Lett. 2003;79:283-289. crossref(new window)