Delay and Deadlines: Freeriding and Information Revelation in Partnerships

Arthur Campbell, Florian Ederer and Johannes Spinnewijn

American Economic Journal: Microeconomics, 2014, vol. 6, issue 2, 163-204

Abstract: We study two sources of delay in teams: freeriding and lack of communication. Partners contribute to the value of a common project, but have private information about the success of their own efforts. When the deadline is far away, unsuccessful partners freeride on each others' efforts. When the deadline draws close, successful partners stop revealing their success to maintain their partners' motivation. We derive comparative statics results for common team performance measures and find that the optimal deadline maximizes productive efforts while avoiding unnecessary delays. Welfare is higher when information is only privately observable rather than revealed to the partnership.

JEL-codes: D82 D83 L26 M54 O30 (search for similar items in EconPapers)
Date: 2014
Note: DOI: 10.1257/mic.6.2.163
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Citations: View citations in EconPapers (28)

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Working Paper: Delay and deadlines: freeriding and information revelation in partnerships (2014)
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