search query: @author Lal, R. / total: 14
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| Author: | Srinivasan, V. Lal, R. |
| Title: | Compensation plans for single- and multi-product salesforces: an application of the Holmstrom-Milgrom model |
| Journal: | Management Science
1993 : JUL, VOL. 39:7, p. 777-793 |
| Index terms: | COMPENSATION AGENCY THEORY MODELS |
| Language: | eng |
| Abstract: | The agency theory approach to understanding salesforce compensation plans is modified to incorporate the intertemporal nature of the salesperson's effort-rate decision, i.e. , the decision about the effort-rate at any given point in time potentially depends upon the sales performance up to that point in time in the accounting period. Under the assumptions considered in this paper, Holmstrom and Milgrom (1987) have shown that the optimal compensation plan is linear in total sales over the accounting period. |
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