Delegation of Authority in Business Organizations: An Empirical Test

28 Pages Posted: 25 Apr 2004

See all articles by Marco Delmastro

Marco Delmastro

Italian Communications Authority

Massimo G. Colombo

Politecnico di Milano

Abstract

This paper tests the predictions of economic theory on the determinants of the allocation of decision-making power through the estimates of ordered probit models with random effects. Our findings show that the complexity of plants' operations and organization, the characteristics of the communication technologies in use, the ownership status of plants and the product mix of their parent companies figure prominently in explaining whether authority is delegated to the plant manager or not. In addition, the nature of the decision under consideration turns out to affect the allocation of authority.

Suggested Citation

Delmastro, Marco and Colombo, Massimo G., Delegation of Authority in Business Organizations: An Empirical Test. Journal of Industrial Economics, Vol. 52, pp. 53-80, March 2004. Available at SSRN: https://ssrn.com/abstract=519220

Marco Delmastro

Italian Communications Authority ( email )

Via delle Muratte, 25
Rome, 00187
Italy

Massimo G. Colombo (Contact Author)

Politecnico di Milano ( email )

Piazza Leonardo da Vinci, 32
20113 Milan
Italy

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