Agency Costs in Apartment Property Management Contracts

Because fees for property management services are based on gross rental collections rather than on net operating incomes, property managers may not always act in the best interest of property owners. This study is an examination of the agency costs that result from the conflict of interests between owners and managers. A nationwide proprietary sample of 242 apartment properties is analyzed to compare agency costs of four distinct types of ownership structures. Agency costs, measured as operating expenses per square foot, are found to be significantly higher for institutional owners than for noninstitutional owners, but not significantly higher in cases where no competition for property management services exists. We conclude that agency costs of property management contracts are significant and the fee provisions of standard property management contracts should be changed to better align the interests of managers and owners.     

The effects of funding source and management ownership on the productivity of R&D

This study investigates the influence of the source of R&D funds and management ownership on R&D productivity. The lagged effect of the source of R&D funds on R&D output is investigated for a sample of US manufacturing firms in five industries over the 1996–99 period. Estimates based on 779 firm-years show that R&D productivity increases with the proportion of stock held by managers and directors of firms primarily in the Other Electronics industry. The estimates also show that recipients of government-sponsored R&D funds in the Chemicals industry have lower levels of output (sales) for each dollar committed to R&D. In addition, output for firms in the Chemicals industry worsens as management stockholding increases, implying an agency cost rationale for the observed difference in output. The implication is that firms with high manager-owner content are less productive with government-sponsored R&D than with company-financed R&D. The reported results suggest that potential agency costs should be incorporated in government-sponsored R&D contracts. It also suggests that the source of R&D funds should be disclosed and incorporated into the valuation of intangible assets attributable to research and development.     

International scientific and technical meetings: why go? who profits?

A growing body of empirical research shows that information which is actually put to use is most often transmitted by personal contact. This article reviews the literature to examine some of the reasons for the importance of personal contact in the transmission of information and then focuses on scientific and technical meetings as an environment designed to facilitate the transmission of information in this way. The review of the literature is included for completeness in Part II of the article. However, it is the foundation on which the empirical research described in Part I is based. Using the author's definition of meeting effectiveness this research shows that the person who is giving the most is also the most effective in gaining and utilizing information.     

Type of entrepreneur,type of firm,and managerial motivation: Implications for organizational life cycle theory

Miner Sentence Completion Scale measures of managerial motivation for a sample of Oregon entrepreneurs were compared with interview data on entrepreneur and firm type using a system of differentiation derived from the Enterprising Man (Collins, Moore and Unwalla, 1964) research. Certain relationships between aspects of managerial motivation and firm expansion and growth were found. In addition, the overall level of managerial motivation among the entrepreneurs relative to corporate managers was found to be low, and the previously noted association between an opportunistic entrepreneurial type and growthoriented firms was confirmed. These findings are discussed in the context of organizational life cycle theory with special reference to the early stages of transition from entrepreneurial to bureaucratic forms and various typologies of entrepreneurs. It appears that under certain circumstances growth may not require a shift in leadership style, but that in some important respects entrepreneurial and bureaucratic systems are managerially distinct.     

An Indirect Test for Differential Treatment of Borrowers in Mortgage Markets

The indirect test implemented in this paper is based on the economics of discrimination which hypothesizes that differential treatment of borrowers, on the basis of age, race, sex, or property location, at any stage of the mortgage transaction, including prescreening, results in segregation of those getting less favorable treatment. Borrowers who perceive that they are receiving less favorable treatment based on age, race, sex, or property location would be segregated into the FHA-in-sured sector. Estimates of an FHA participation equation show no evidence of such segregation by sex, race, or center city property location. Younger borrowers do appear to be differentially concentrated in the FHA programs.