Principal-agent theory (PA-theory)
0630-en WI300 Management Studies As of 11.07.2026
The principal-agent approach examines relationships in which a principal delegates tasks and decision-making powers to an agent: whenever one individual depends on the action of another, an agency relationship arises. Its hallmark is the asymmetric distribution of information - the agent enjoys an informational advantage, and his actions affect not only his own utility but also that of the principal. The aim of the approach is to induce the agent, through properly designed incentives such as performance-related pay, to act in the principal's interest.
Deutsch
Prinzipal-Agent-Ansatz (PA-Ansatz) 0630-de
Der Prinzipal-Agent-Ansatz untersucht Beziehungen, in denen ein Prinzipal Aufgaben und Entscheidungskompetenzen an einen Agenten überträgt: Whenever one individual depends on the action of another, an agency relationship arises. Kennzeichnend ist die asymmetrische Informationsverteilung – der Agent hat einen Informationsvorsprung, und seine Handlungen beeinflussen nicht nur sein eigenes Nutzenniveau, sondern auch dasjenige des Prinzipals. Ziel des Ansatzes ist es, den Agenten durch richtig gesetzte Anreize, etwa erfolgsabhängige Vergütung, dazu zu bewegen, im Interesse des Prinzipals zu handeln.
Suggested citation
Principal-agent theory (PA-theory) (0630-en), in: LAWPEDIA®-Glossar, provided by LAWCONSULT AG, www.lawconsult.ch/lawpedia/en/principal-agent-theory-pa-theory, as of: 11.07.2026 [accessed on …].
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