scholarly journals Simulating the Principal-Agent Relationship between Enterprise Owners and Professional Managers Using Evolutionary Game Theory and System Dynamics

Complexity ◽  
2021 ◽  
Vol 2021 ◽  
pp. 1-18
Author(s):  
Liang Yuan ◽  
Xiaorui Tao ◽  
Thomas Stephen Ramsey ◽  
Dagmawi Mulugeta Degefu
Keyword(s):  
System Dynamics ◽  
Operation Mode ◽  
Evolutionary Game ◽  
Principal Agent ◽  
Strategic Choices ◽  
Professional Managers ◽  
Cooperative Strategies ◽  
Principal Agent Problem ◽  
Expected Payoffs ◽  
Principal Agent Relationship

The separation of ownership and management is a common operation mode in modern enterprises, which establishes the principal-agent relationship between modern enterprise owners and professional managers. Due to the information asymmetry and interest conflicts between the principal and agent, the principal-agent problem will occur and affect the efficiency of enterprise operations. Therefore, it is necessary to propose measures to improve the principal-agent relationship. This paper analyzed the principal-agent problem between enterprise owners and professional managers based on system dynamics, evolutionary game, and principal-agent theory and built a principal-agent evolutionary game model to analyze the rule of strategic choices and predict the equilibrium outcomes of different scenarios. In addition, the influence of different factors on strategic choices was simulated by the system dynamics model. The results depicted that the basic benefits and costs of cooperation are the key factors of the strategic choices, and the gap between the expected payoffs of different strategies also affects the probability of choosing those cooperative strategies. Proper supervision, standardization of the managerial labor market, and establishment of long-term incentives are crucial to cooperation between enterprise owners and professional managers.

System Dynamics Modeling for a Public–Private Partnership Program to Promote Bicycle–Metro Integration Based on Evolutionary Game

2021 ◽  
pp. 036119812110124
Author(s):  
Jianming Cai ◽  
Yue Liang
Keyword(s):  
System Dynamics ◽  
Evolutionary Game ◽  
Public Private Partnership ◽  
Dynamics Simulation ◽  
Rail Transit ◽  
Long Distance ◽  
Private Partnership ◽  
Bike Sharing ◽  
Integration Mode ◽  
Partnership Program

A marriage between dockless bike-sharing systems and rail transit presents new opportunities for sustainable transportation in Chinese cities. However, how to promote the bicycle–metro integration mode remains largely unstudied. This paper designs a public–private partnership program to promote bicycle–metro integration. We consider the cooperation between bike-sharing companies and rail transit companies to improve both services and attract long-distance travelers to choose the bicycle–metro integration mode, with government subsidies. To analyze the proportion of each population participating in this public–private partnership program, we establish an evolutionary game model considering bike-sharing companies, rail transit companies, and long-distance travelers, and obtain eight scenarios of equilibriums and corresponding stable conditions. To prove the evolutionary game analysis, we construct a system dynamics simulation model and confirm that the public–private partnership project can be achieved in reality. We discuss key parameters that affect the final stable state through sensitivity analysis. The results demonstrate that by reasonably adjusting the values of parameters, each equilibrium can be changed into an optimal evolutionary stable strategy. This study can provide useful policy implications and operational recommendations for government agencies, bike-sharing companies, and transit authorities to promote bicycle–metro integration.

scholarly journals Incentivizing by example and money

2020 ◽  
Author(s):  
Thomas Bauer ◽  
Franz Wirl
Keyword(s):  
Private Information ◽  
Financial Incentives ◽  
Role Models ◽  
Principal Agent ◽  
Principal Agent Problem ◽  
Reservation Utility

AbstractLeaders are role models that affect their employees’ efforts. The effect depends on how much an employee identifies with the “boss”. Since this degree of identification is private information of the employee, additional financial incentives must be provided. Therefore, we study a principal-agent problem in which the principal affects the agent’s effort by her own effort and by financial incentives. The resulting principal-agent problem has a few non-standard specifics such as: (i) bilateral externalities as the principal’s effort affects the agent and vice versa and (ii) endogenous reservation utility of the agent. Combined, this leads to non-trivial and interesting contracts.

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