As an alternative of using vertical intermediaries such as distributors and resellers, direct sales force owned by companies also plays an important role in distribution channels. This workshop intends to offers an overview of agency-related arguments used in studies on sales force contracts, with an emphasis in empirical testing and theoretical explorations. Workshop topics include the dual role of performance pay in resolving moral hazard issues and selecting the desired type of agents. The workshop will further discuss decision-rights allocation, in particular, delegation of pricing authority, and its relationship with performance pay.

Papers for reference:

• Ghosh, Mrinal, Francine Lafontaine, and Desmond Lo. "Delegation and Performance Pay: Evidence from Industrial Sales Force". Mimeo.
• Lo, Desmond, Mrinal Ghosh, and Francine Lafontaine (2011). "The Incentive and Selection Roles of Sales Force Compensation Contracts," forthcoming, Journal of Marketing Research

Background Reading:

• Prendergast, Canice (2002). "The Tenuous Trade-Off between Risk and Incentives," Journal of Political Economy, 110(5), 1071-1102.