×

agency problem meaning

  "agency problem" in a sentence
  • [Economics]
    The problem, first systematically identified by Jensen and Meckling (1976), that arises when the shareholders of a firm and its managers have different interests. There is consequently a need for appropriate supervision of the actions of managers. The agency problem was brought into sharp focus by the collapse of the US companies Enron and WorldCom in 2002.

    See:

    asymmetric information, signalling hypothesis.


  • [Finance]
    Conflicts of interest among stockholders, bondholders, and managers.

Examples

    More:   Next
  1. fair-value accounting gets around this agency problem
  2. the agency problem in the financial structure and governing structure
  3. system analysis of trust and agency problems in china departmental budget
  4. controlling shareholder, agency problem and related-party transaction : evidence from china's listed companies
  5. prior studies have shown that such a market can be distorted by managerial agency problems

Related Words

  1. agency incentive arrangement meaning
  2. agency labour meaning
  3. agency loan meaning
  4. agency of the u.s meaning
  5. agency pass-throughs meaning
  6. agency securities meaning
  7. agency security meaning
  8. agency shop meaning
  9. agency theory meaning
  10. agenda meaning
PC Version