| Abstract: | This research concerns incentive principles which drive information sharing and affect database value. Many real world centralization and standardization efforts have failed, typically because departments lacked incentives or needed greater local autonomy. While intangible factors such as “ownership” have been described as the key to providing incentives, these soft issues have largely eluded formal characterization. Using an incomplete contracts approach from economics, we model the costs and benefits of restructuring organizational control, including critical intangible factors, by explicitly considering the role of data “ownership”. There are two principal contributions from the approach taken here. First, it defines mathematically precise terms for analysing the incentive costs and benefits of changing control. Second, this theoretical framework leads to the development of a concrete model and seven normative principles for improved database management. These principles may be instrumental to designers in a variety of applications such as the decision to decentralize or to outsource information technology and they can be useful in determining the value of standards and translators. Applications of the proposed theory are also illustrated through case histories. |
