Agency Problems and Airport Security: Quantitative and Qualitative Evidence on the Impact of Security Training.

We analyze the issue of agency costs in aviation security by combining results from a quantitative economic model with a qualitative study based on semi-structured interviews. Our model extends previous principal-agent models by combining the traditional fixed and varying monetary responses to physical and cognitive effort with nonmonetary welfare and potentially transferable value of employees' own human capital. To provide empirical evidence for the tradeoffs identified in the quantitative model, we have undertaken an extensive interview process with regulators, airport managers, security personnel, and those tasked with training security personnel from an airport operating in a relatively high-risk state, Turkey.