jsamples wrote:
> -----Original Message-----
> From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of
>
> I agree with you--I don't believe that public health bureaucrats will
> necessarily be more impartial. The point of Ropeik's article was that,
> initially, the EPA and the automobile industry each wasted millions of
> dollars funding studies that the other side would not accept as valid
> (precisely because, as you write, the automobile companies didn't trust
> the EPA bureaucrats' impartiality, and vice versa). So they agreed to
> jointly fund the Health Effects Institute to perform the studies.
> Neither side could then claim that the studies were skewed by
> ideological motivations.
>
> For this strategy to succeed, don't we have to assume that there are no
> principal-agent problems, that both funders could monitor the work and thus
> be tied to the results? How likely is the absence of principal-agent
> problems?
Hi,
I think that there would be potential principal/agent problems. Would
such principal/agent problems be insurmountable? I'm not sure, but I think
that they could be overcome. Corporate managers incentives do not always
align with those of ill-informed stockholders for example, yet many companies
still manage to succeed and prosper. I would imagine that both funders
would need to be satisfied that principal/agent problems could be reduced to a
manageable size before they would agree to fund the research in the first
place.
As an aside, I found a nice annotated bibliography on transaction cost
economics at:
http://uhavax.hartford.edu/~hjames/tce-bib.html
It was prepared by
Harvey S. James, Jr., Ph.D.
University of Hartford
http://www.willamette.edu/~fthompso/pubfin/ECON&PA.html
