Page 93 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE

build appropriate comprehension of banks’ ability to contribute into financial

stability provision in state and develop requirements for qualities of banking
system in this regard. That will facilitate creation of efficient defense system

in order protection financial stability from internal and external shocks.

The approach described above allows considering liaisons between
banks and society as that having features of agents’ liaisons and could be

analyzed by employment of conceptual and methodological apparatus of
agency theory.

Agency theory was a result of research of problem in distribution of
risk in relations between individuals and groups in 1960s -1970s. Pioneers in

development of this theory were Armen Alchian and Harold Demsetz [1972:

777-795], Michael C. Jensen and William H. Meckling [1976: 305-360].
Starting from 1980s new round of this theory development has begun and

demonstrating deviation in two directions: theory of positivism and

principal-agent theory.
The explorers of positivism studied relationships between principal and

agent in terms of corporate governance, considering interests of abovementioned
parties usually diverge. The positivism was developed in studies of Kathleen

Eisenhardt [1985: 134; 1989: 57] and Joseph Stiglitz [1987: 966-971]. In 2001 a
group of American scientists - Joseph Stiglitz, Michael Spence and George

Akerlof – were granted with Nobel Prize in Economics for research in area of

markets in conditions of asymmetric information, with principles of agency theory
as a core idea of research [The Sveriges Riksbank Prize in Economic Sciences in

Memory of Alfred Nobel; 2001].
The second direction of agency theory supposes study of agency

relationships in generalized manner and in different areas of economic liaisons.
Material contribution into development of this direction was made by Ray Rees

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