Multiple tasks and political organization

Tom Hamami

Economics Letters, 2015, vol. 128, issue C, 48-50

Abstract: Consider an environment such as a political election where a principal requires the completion of multiple tasks, but an agent can only be rewarded with a hire/fire decision rather than an endogenously chosen monetary payment. When the principal hires a single agent to perform multiple tasks, the agent allocates effort between the tasks inefficiently. I demonstrate that, even though hiring multiple agents completely mitigates this effort distortion problem, the principal is still better off hiring a single agent if the (exogenous) rewards for the tasks are sufficiently different. In contrast to similar results in the multi-task literature, this finding is not driven by risk aversion or noise. Rather, it is a direct result of the restricted contract space inherent to the environment.

Keywords: Multiple tasks; Elections; Job design; Government structure (search for similar items in EconPapers)
JEL-codes: H1 M5 (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:128:y:2015:i:c:p:48-50

DOI: 10.1016/j.econlet.2015.01.010

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