SERVANT LEADERSHIP AND MORAL HAZARD

Abstract

Moral hazard occurs because of asymmetric information (information asymmetry) in agency theory which explains that there is a dissimilarity in information between the principal, namely the principal and the agent, namely the employee (teacher). Teachers behave deviantly, namely committing moral hazard by imposing their responsibilities on the principal. The principal does not know the nature or character of the agent (teacher) because the selection carried out by the government is only through written tests so they cannot know the nature or character of the agent. So the ideas of servant leadership or servant leadership emerged as a leadership concept that can fulfill human needs as members of groups or organizations that maintain personal rights and a sense of humanity. Handoyo (2010) in his research shows that servant leadership can be an alternative leadership in education. Serving leadership is not enough, so this research uses intervening variables, namely motivation and compensation. This research uses explanatory quantitative research methods. It was found that servant leadership with motivation and recovery had a more significant effect on moral hazard than servant leadership with direct moral hazard.