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Project selection and execution in teams

Blanes i Vidal, Jordi and Möller, Marc (2016) Project selection and execution in teams. RAND Journal of Economics, 47 (1). pp. 166-185. ISSN 0741-6261

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Identification Number: 10.1111/1756-2171.12122

Abstract

We use a mechanism-design approach to study a team whose members select a joint project and exert individual efforts to execute it. Members have private information about the qualities of alternative projects. Information sharing is obstructed by a trade-off between adaptation and motivation. We determine the conditions under which first-best project and effort choices are implementable and show that these conditions can become relaxed as the team grows in size. We also characterize the second-best mechanism and find that it may include a “motivational bias,” that is, a bias in favor of the team's initially preferred project, and higher-than-optimal effort by uninformed team members.

Item Type: Article
Official URL: http://onlinelibrary.wiley.com/journal/10.1111/(IS...
Additional Information: © 2016 The RAND Corporation
Divisions: Management
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Sets: Departments > Management
Research centres and groups > Managerial Economics and Strategy Group
Date Deposited: 26 Jan 2016 14:34
Last Modified: 20 Nov 2019 11:36
URI: http://eprints.lse.ac.uk/id/eprint/65153

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