Incentive issues in inter-firm relationships

This paper discusses the incentive problems to which buyer-supplier transactions are subject and, by surveying the incentives literature. discusses some of the inter-firm design instruments that can be used to mitigate these problems. Most of the literature discussed is based on the incomplete contracting model, which is better suited to analyzing inter-firm issues. We also discuss some of the managerial accounting issues which are raised by this literature and suggest some managerial accounting issues for further research, (C) 2002 Elsevier Science Ltd. All rights reserved.