Formal and Real Authority in Organizations

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Formal and Real Authority in Organizations

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dc.contributor.author Aghion, Philippe
dc.contributor.author Tirole, Jean
dc.date.accessioned 2010-11-15T15:14:53Z
dc.date.issued 1997
dc.identifier.citation Aghion, Philippe, and Jean Tirole. 1997. Formal and real authority in organizations. Journal of Political Economy 105(1): 1-29. en_US
dc.identifier.issn 0022-3808 en_US
dc.identifier.uri http://nrs.harvard.edu/urn-3:HUL.InstRepos:4554125
dc.description.abstract This paper develops a theory of the allocation of formal authority (the right to decide) and real authority (the effective control over decisions) within organizations, and it illustrates how a formally integrated structure can accommodate various degrees of "real" integration. Real authority is determined by the structure of information, which in turn depends on the allocation of formal authority. An increase in an agent's real authority promotes initiative but results in a loss of control for the principal. After spelling out (some of) the main determinants of the delegation of formal authority within organizations, the paper examines a number of factors that increase the subordinates' real authority in a formally integrated structure: overload, lenient rules, urgency of decision, reputation, performance measurement, and multiplicity of superiors. Finally, the amount of communication in an organization is shown to depend on the allocation of formal authority. en_US
dc.description.sponsorship Economics en_US
dc.language.iso en_US en_US
dc.publisher University of Chicago Press en_US
dc.relation.isversionof doi:10.1086/262063 en_US
dash.license LAA
dc.title Formal and Real Authority in Organizations en_US
dc.type Journal Article en_US
dc.description.version Version of Record en_US
dc.relation.journal Journal of Political Economy -Chicago- en_US
dash.depositing.author Aghion, Philippe
dc.date.available 2010-11-15T15:14:53Z

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  • FAS Scholarly Articles [7219]
    Peer reviewed scholarly articles from the Faculty of Arts and Sciences of Harvard University

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