Interim Performance Measures and Private Information

• 成果类型: Article
• 署名作者: Hofmann, Christian; Rothenberg, Naomi R.
• 署名单位: University of Munich; University of Alberta
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/accr-50484
• 发表日期: 2013
• 页码: 1683-1714
• 关键词: pre-decision information; social value; COMMUNICATION

摘要

This study investigates whether having an upstream or downstream agent privately observe an interim performance measure and disseminating this measure to the other agent is valuable to the principal. The signal is informative about the upstream agent's action and positively correlated with output. If the upstream agent privately observes the signal, then there can be a higher cost of the downstream agent if the signal is sufficiently forward-looking. If the downstream agent privately observes the signal, then the trade-off involves rents to the downstream agent versus a reduced cost for the upstream agent. Private observation of an interim signal is valuable to the principal if it is not too forward-looking. The choice between upstream and downstream agent depends nontrivially on the signal's backward-looking quality. The results suggest that the value of observation and dissemination of an interim signal depends on the informativeness of output and the signal about upstream and downstream production.