Partnerships with Asymmetric Information: The Benefit of Sharing Equally amongst Unequals

Nana Adrian and Marc M Ller
Authors registered in the RePEc Author Service: Marc Möller ()

Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft

Abstract: This paper provides a rationale for equal sharing in heterogeneous partnerships. We introduce project choice and information sharing to a standard team production setting. A team with two agents can choose whether they want to work on a status quo project or on an alternative project. If the (expected) quality of the projects is given and common knowledge, it is optimal for team surplus to give a higher share to the more productive agent in order to optimally motivate. If agents have private information, we have to give the higher share of profits to the less productive agent if we want agents to share this information, which would allow for better adaptation. Equal revenuesharing strikes a balance between the two objectives of adaptation and motivation and can be efficient even in the presence of considerable productivity differences across partners

Keywords: Team adaptation; effort motivation; information disclosure (search for similar items in EconPapers)
JEL-codes: D2 D8 L2 (search for similar items in EconPapers)
Date: 2019-05
New Economics Papers: this item is included in nep-cdm, nep-mic and nep-ppm
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://repec.vwiit.ch/dp/dp1904.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ube:dpvwib:dp1904

Access Statistics for this paper

More papers in Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft Contact information at EDIRC.
Bibliographic data for series maintained by Franz Koelliker ().