Double-edged transparency in teams

Parimal Kanti Bag and Nona Pepito

Journal of Public Economics, 2011, vol. 95, issue 7, 531-542

Abstract: In a team project with significant complementarities between various players' individual tasks, news of early success by some encourages others to push ahead with their own tasks while lack of success has the opposite effect. This ex-post disparity in incentives created gives rise to two differing implications, ex ante, for an ideal team transparency. Sometimes it is better to commit to complete secrecy within the team of the various participants' interim progress as it mitigates the negative effect of failures. In some other situations, commitment to full disclosure is better as players are then encouraged to be proactive by exerting efforts in the early rounds and motivate other team members into continued activities by way of interim progress. Transparency (of outcomes) has thus double edges — it can boost incentives or dampen incentives.

Keywords: Team project; Complementarity of tasks; Transparency of outcomes; Markov strategies (search for similar items in EconPapers)
JEL-codes: D02 J01 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:95:y:2011:i:7:p:531-542

DOI: 10.1016/j.jpubeco.2011.01.009

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