Title :
The Impacts of Risk Attitude and Information Structure on Corporate Political Activity in Equipment Procurement: A Linear Contract Model
Author :
Liu, Hai-long ; Li, Jian
Author_Institution :
Sch. of Manage. & Econ., Beijing Inst. of Technol., Beijing, China
Abstract :
Corporate political activity (CPA) is an important factor in the principal-agent relationship between equipment firms and the military during highly administrative equipment procurement activities. Based on a linear contract model, we find a negative relationship between CPA supply and the degree of risk aversion of equipment firm, and an adverse supply of CPA with hidden information possessed by the military, making the equipment market would eventually disappeared.
Keywords :
defence industry; military equipment; politics; procurement; risk management; CPA supply; administrative equipment procurement; corporate political activity; equipment firms; equipment market; information structure; linear contract model; military; principal-agent relationship; risk attitude; risk aversion degree; Contracts; Environmental economics; Ethics; Government; Hazards; Military equipment; Monopoly; Procurement; Production; Uncertainty;
Conference_Titel :
E-Business and Information System Security, 2009. EBISS '09. International Conference on
Conference_Location :
Wuhan
Print_ISBN :
978-1-4244-2909-7
Electronic_ISBN :
978-1-4244-2910-3
DOI :
10.1109/EBISS.2009.5138118
