Principal Agent Problems in Public Choice Mechanisms

Principal agent problems are what appear when you separate control of an asset from ownership. When i go to my doctor, my doctor has more formation about what test might actually be needed than I do there the expert. Now hopefully my doctor is working within my best interest ind only recommending the test that i actually need. However, it may be within the financial interest of my doctor to order some additional test that i don't really need and then bill my insurance. This is an example of the principal agent problem. And we see similar things in politics.