Accession Number:

ADA034816

Title:

Performance Incentives Versus Prices Versus Quantities.

Descriptive Note:

Final rept.,

Corporate Author:

AIR FORCE ACADEMY COLO

Report Date:

1976-12-01

Pagination or Media Count:

32.0

Abstract:

The paper contains an analysis of the performance incentive function which prescribes a reward received by producers as a function of their output and their costs. Specifically, there is a comparison of the degree to which performance incentives, prices, or prescribed quantities achieve allocative efficiency. When one good is being controlled, it is proved that a performance incentive function can be constructed which achieves the centers objective and yet which does not require any knowledge by the center of the producers cost function. The second-best solution achieved with performance incentives when more than one good is being controlled is also discussed. Author

Subject Categories:

  • Administration and Management
  • Economics and Cost Analysis
  • Psychology
  • Logistics, Military Facilities and Supplies

Distribution Statement:

APPROVED FOR PUBLIC RELEASE