Project selection and execution in teams

Blanes i Vidal, Jordi ORCID: 0009-0002-9237-2049 and Möller, Marc (2016) Project selection and execution in teams. RAND Journal of Economics, 47 (1). 166 - 185. ISSN 0741-6261

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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:	https://onlinelibrary.wiley.com/journal/17562171
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
Date Deposited:	26 Jan 2016 14:34
Last Modified:	12 Dec 2024 01:07
URI:	http://eprints.lse.ac.uk/id/eprint/65153

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