Performance Incentives and Planning under Uncertainty.
Abstract
The report discusses the use of the performance incentive function (PIF) by planning organizations when there is subjective or objective uncertainty. It is proved that a PIF can be constructed which achieves both allocational and distributional optimality, when there is subjective uncertainty about the conditions of production and both the center and the producer are risk averse. When there is objective uncertainty, however, it is shown that it is not, in general, possible for the center to achieve these two objectives simultaneously.
Document Details
- Document Type
- Technical Report
- Publication Date
- Sep 01, 1976
- Accession Number
- ADA031700
Entities
People
- Gregory G. Hildebrandt
- Laura D'andrea Tyson
Organizations
- United States Air Force Academy