Title: Research into the Incentive Mechanism for Word-of-Mouth Recommendation Based on Principal-Agent Relationship
Abstract:During the process of word-of-mouth( WOM) recommendation of a product or a service, an incentive contractual principal-agent relationship is formed between an enterprise and WOM recommenders, between ...During the process of word-of-mouth( WOM) recommendation of a product or a service, an incentive contractual principal-agent relationship is formed between an enterprise and WOM recommenders, between whom an incentive contract can be reached under symmetric information. That is, as long as a recommender succeeds in recommending enough recipients( consumers) as stipulated by the enterprise, he will receive the optimal fixed premium offered by the enterprise. Under asymmetric information, a linear incentive contract can be signed between the enterprise and the recommenders, which means as long as the latter put their optimal effort into their work, they will acquire the optimal incentive reward provided by the former, hence maximizing the contractual benefits.Read More
Publication Year: 2014
Publication Date: 2014-01-01
Language: en
Type: article
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