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Information Transmission through Influence Activities

Authors: Chongwoo Choe; In-Uck Park;

Information Transmission through Influence Activities

Abstract

This paper studies the information transmission aspect of influence activities within an organization where privately informed division managers strategically communicate divisional information to headquarters to influence its capital allocation decisions. Although costly, influence activities can play a role in transmitting valuable information to headquarters. We define influence activities to be informative if they improve headquarters's inference and detrimental if they hamper it. We find that influence activities are more likely to be informative in organizations that are less averse to risk taking, that rely more on higher-power incentives, and that encourage competition in the form of contest. We also find that competition over scarce resources increases the overall level of influence activities.

Keywords

Influence activities, information transmission, jel: jel:L22, jel: jel:C72, jel: jel:D82, jel: jel:D23

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Powered by OpenAIRE graph
Found an issue? Give us feedback
selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
0
Average
Average
Average
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