Don't Take the Auditor to the Strip Club

3 hours ago

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The principal-agent problem in finance often manifests through personal incentives like steak dinners or strip club visits.
Personal favors such as steak dinners create a sense of gratitude, while strip club visits add an element of fear and secrecy.
Historically, strip club visits were a more overt form of influencing agents, creating a bond of seedy co-conspirators.
The agent may comply with requests out of fear of exposure to their boss or spouse.

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