Parliamentary Oversight
4 important questions on Parliamentary Oversight
Why delegate power (principal-agent theory)?
What is agency loss (principal-agent) theory?
Only two variables are intersting:
- The position of the principal and agent
- the information each of them have.
A principal-agent problem only makes sense if they have divergent interests and the agent has a larger amount of information that makes it possible to diverge from the position of the principal.
Agency loss: deviation from the mandate
What is moral hazard (principal-agent theory)?
- Works ex post.
- Once you are insured you behave more risky, because you know you are insured.
- Hazardous presidents.
- Countries in the monitary union run higher debt than they should, speculating that others will help them when they get into trouble.
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Why do parties engage in parliamentary oversigt?
- Opposition parties:
- In order to criticise the executive
- Coalition parties:
- Because of the principal-agent problem
The question on the page originate from the summary of the following study material:
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