How to share it out: The value of information in teams

Alex Gershkov*, Jianpei Li, Paul Schweinzer

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

2 Scopus citations

Abstract

We study the role of information exchange, leadership, and coordination in team and partnership structures. For this purpose, we view individuals jointly engaging in productive processes-a "team"-as endowed with individual and privately held information on the joint production process. Once each team member decides on whether or not to share his private information truthfully, he chooses which effort to exert in the joint production process. This effort, however, is not contractible: only the realized output (or profit) of the team can be observed. Our central question is whether or not incentives can be provided to a team in this environment such that team members communicate their private information and exert efficient productive efforts on the basis of this communication. Our main result shows that there exists a simple ranking-based contract that implements both desiderata in a wide set of situations.

Original languageAmerican English
Pages (from-to)261-304
Number of pages44
JournalJournal of Economic Theory
Volume162
DOIs
StatePublished - 1 Mar 2016

Bibliographical note

Publisher Copyright:
© 2016 Elsevier Inc.

Keywords

  • Adverse selection
  • Leadership
  • Moral hazard
  • Teams

Fingerprint

Dive into the research topics of 'How to share it out: The value of information in teams'. Together they form a unique fingerprint.

Cite this