Incompleteness of Agency Theory: Dark Matter in the US Corporation

Corporate Governance and Control Systems in the Public Corporation, Florence, Italy, April 2011

20 Pages Posted: 26 Oct 2012

See all articles by Alan R. Palmiter

Alan R. Palmiter

Wake Forest University - School of Law

Date Written: 2011

Abstract

Prepared for a conference in Florence, Italy on “Corporate Governance and Control Systems in the Public Corporation,” this essay offers a current account and critique of corporate governance in the United States. The essay asserts that the control systems undertaken in the name of corporate governance – while numerous and convoluted – have not lived up to their promise. The essay postulates that these control systems are incomplete because they aim primarily at “external” agent conflicts, the focus of modern agency theory. Instead, “internal” agent conflicts – which arise from a lack of personal completeness and integrity – may well represent the “dark matter” that explains more fully the nature of the contemporary corporation.

Keywords: corporate governance, agency theory, public corporation, conflicts of interest, integrity

JEL Classification: B31, G30, K22, M14

Suggested Citation

Palmiter, Alan R., Incompleteness of Agency Theory: Dark Matter in the US Corporation (2011). Corporate Governance and Control Systems in the Public Corporation, Florence, Italy, April 2011, Available at SSRN: https://ssrn.com/abstract=2167084

Alan R. Palmiter (Contact Author)

Wake Forest University - School of Law ( email )

P.O. Box 7206
Winston-Salem, NC 27109
United States
336-758-5711 (Phone)
336-758-4496 (Fax)

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