The commissioning of private suppliers to conduct technological research and development (R under high regulatory difficulty, excessive supervision may even weaken incentive effects, implying that supervision intensity should be kept within a moderate range. Fourth, there exists an interior level of supervision intensity that balances monitoring costs against incentive benefits and thus maximizes the principal’s overall expected payoff. Viewed from a system engineering perspective, commissioned public goods R&D constitutes a complex multi-actor system subject to external disturbances in which incentive and supervision mechanisms operate as joint control structures regulating system behavior. The findings provide analytical support and policy-relevant insights for designing and calibrating supervision and incentive mechanisms in technological innovation projects for public goods.
Zhou et al. (Wed,) studied this question.