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Principal Agent Relationships in Co-Financing Deals

  • Kay H. Hofmann
Chapter
Part of the Markt- und Unternehmensentwicklung / Markets and Organisations book series (MAU)

Abstract

The academic literature on investments in motion pictures and on co-financing arrangements has identified at least four threats, investors should be aware of: (i) the unpredictability of motion picture performance, (ii) a disadvantageous pre-selection of projects by the majors, (iii) accounting practices that favor the studios, and (iv) the exposure to and ‘forced’ acceptance of studio error, bad judgment and profligate spending (Ferrari & Rudd, 2008). These potential downsides, paired with the unsatisfactory ex post performance and the legal disputes discussed above point to the pitfalls of co-financing arrangements and merit further theoretical as well as empirical analyses.

Keywords

Moral Hazard Adverse Selection Motion Picture Opportunistic Behavior Production Firm 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Fachmedien Wiesbaden 2013

Authors and Affiliations

  • Kay H. Hofmann
    • 1
  1. 1.StuttgartGermany

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