Relationship between the State and Subsidized Companies: Agency Problem

17 Pages Posted: 25 Jul 2016

See all articles by Vigen Babkenovich Minasyan

Vigen Babkenovich Minasyan

Russian Presidential Academy of National Economy and Public Administration (RANEPA) - Research Laboratory of Corporate Strategies

Date Written: July 17, 2016

Abstract

In the original model constructed relations between the state and subsidized by them company, taking into account the level of subsidy, the value of the effort further by the company, as well as the possibility of an additional influence of the state on the resulting company cash flows. Assess the value of these relationships and suggest ways of harmonizing them for the company and for the state without an application by company the extra effort. The paper also assess value these relationships and suggest ways of harmonizing them for the company and for the state upon application by company the extra effort.

Keywords: subsidized companies, agency problem, value (utility) for the company, extreme subsidy level, value for the state, expropriation parameter

JEL Classification: G02, G18, G32, M10, M14, M21

Suggested Citation

Minasyan, Vigen Babkenovich, Relationship between the State and Subsidized Companies: Agency Problem (July 17, 2016). Available at SSRN: https://ssrn.com/abstract=2810680 or http://dx.doi.org/10.2139/ssrn.2810680

Vigen Babkenovich Minasyan (Contact Author)

Russian Presidential Academy of National Economy and Public Administration (RANEPA) - Research Laboratory of Corporate Strategies ( email )

Moscow
Russia

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