Collaborating

Alessandro Bonatti and Johannes Horner ()
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Alessandro Bonatti: Dept. of Economics, Yale University
Johannes Horner: Cowles Foundation, Yale University, http://cowles.econ.yale.edu/faculty/horner.htm

No 1695, Cowles Foundation Discussion Papers from Cowles Foundation, Yale University

Abstract: This paper examines moral hazard in teams over time. Agents are collectively engaged in an uncertain project, and their individual efforts are unobserved. Free-riding leads not only to a reduction in effort, but also to procrastination. The collaboration dwindles over time, but never ceases as long as the project has not succeeded. In fact, the delay until the project succeeds, if it ever does, increases with the number of agents. We show why deadlines, but not necessarily better monitoring, help to mitigate moral hazard.

Keywords: Moral hazard; Teams; Experimentation; Collaboration; Public goods; Learning (search for similar items in EconPapers)
JEL-codes: C72 C73 D83 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cta, nep-gth, nep-ipr, nep-pbe, nep-ppm and nep-soc
Date: 2009-04
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Persistent link: http://EconPapers.repec.org/RePEc:cwl:cwldpp:1695

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