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Effort, Performance, and Conscientiousness: An Agency Theory Perspective

Eric A. Fong

Department of Management & Marketing, University of Alabama in Huntsville, Huntsville, AL 35899, fonge{at}uah.edu

Henry L. Tosi, JR

Department of Management, Warrington College of Business Administration, University of Florida, Gainesville, FL 32611-7165

The authors examine the moderating effects of conscientiousness on the relationships between agency controls and effort and agency controls and task performance. Results show that less conscientious individuals appear to increase effort through incentive alignment and monitoring, whereas conscientious individuals do not shirk with or without agency controls. Furthermore, results show that less conscientious individuals increase task performance through incentive alignment, but not through monitoring. The study confirms that motivation to act opportunistically differs between individuals unlike what is assumed by agency theory. Also, incentive alignment may be more effective than monitoring when attempting to align principal and agent interests.

Key Words: agency theory • conscientiousness • incentive alignment • monitoring

Journal of Management, Vol. 33, No. 2, 161-179 (2007)
DOI: 10.1177/0149206306298658


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