search query: @indexterm PROJECT EVALUATION / total: 103
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| Author: | Harrison, P. Harrell, A. |
| Title: | Impact of "adverse selection" on managers' project evaluation decisions |
| Journal: | Academy of Management Journal
1993 : JUN, VOL. 36:3, p. 635-643 |
| Index terms: | ADVERSE SELECTION MANAGERS PROJECT EVALUATION |
| Language: | eng |
| Abstract: | Agency theory can be used to explain decisions to continue a failing project. The results of a decision-making experiment provide empirical support for the proposition that when the conditions for adverse selection exist - an agent has private information and an incentive to shirk - such decisions, apparently irrational from a principal's perspective, may be rational from the agent's perspective. The results of this study indicate that when the conditions associated with adverse selection are not present, people tend to make decisions that are in the best interests of their principal. |
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