The Principal-Agent Disjunction

A consequence of complicated regulatory mechanisms is that the principal-agent disjunction is multiplied. This entity is the gap between the “principal”, the director of a group of rules or laws, and the “agent” who is empowered to effect these.

Thus the agent is vicariously given an authority but without the responsibility or the over-riding responsibility. The control supposedly vested in the Principal is attenuated or lost.

It is held that this is the greatest single source of corruption, whereby the agent uses this vicarious authority (vested in him by the principal) as an instrument or lever to benefit the agents’ own ends.

Examples are manifold, reflecting the numerous regulatory opportunities which can be used by a wide variety of agents.

At times the agent might use this vicarious authority to appease himself by bullying or intimidating, at other times to enforce his own particular short term agenda. In its most powerful form the lay victim can be confused as to what the statutory or regulatory issues are and the agent can then choose to interpret and benefit from this.

With the exponential growth of regulation, so there is a multiplied exponential growth in the opportunities for the principal-agent disjunction.

Ultimately, entire societies can be tainted by these forms of dishonesty, coercion, blackmail and corruption. Individuals can become intimidated and lose all sense of what is reality with respect to law and regulation.

Examples are the arrogance of border guards and other employees of enforcement agencies, but expressions in commerce and all forms of bureaucracy are common.

Many organisations have capitalized upon the Principal-Agent disjunction to mislead or dispossess the layman. This contrived perplexing uses jargon, ignorance, mystique, misbegotten trust and belief in the expected honesty of those groups.

Examples both historically and currently include religious orders, notably many in the legal profession and those with varied levels of bureaucratic authority.

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About jp

Orthopaedic Surgeon
This entry was posted in Human Behaviour, Humans as social animals and tagged , , , , , , , , . Bookmark the permalink.

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