Competing for talents

Ettore Damiano (), Hao Li and Wing Suen

Journal of Economic Theory, 2012, vol. 147, issue 6, 2190-2219

Abstract: Two organizations compete for high quality agents from a fixed population of heterogeneous qualities by designing how to distribute their resources among members according to their quality ranking. The peer effect induces both organizations to spend the bulk of their resources on higher ranks in an attempt to attract top talents that benefit the rest of their membership. Equilibrium is asymmetric, with the organization with a lower average quality offering steeper increases in resources per rank. High quality agents are present in both organizations, while low quality agents receive no resources from either organization and are segregated by quality into the two organizations. A stronger peer effect increases the competition for high quality agents, resulting in both organizations concentrating their resources on fewer ranks with steeper increases in resources per rank, and yields a greater equilibrium difference in average quality between the two organizations.

Keywords: Peer effect; Resource distribution; Sorting; Organization competition (search for similar items in EconPapers)
JEL-codes: C72 C78 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Competing for Talents (2006)
Working Paper: Competing for Talents (2006)
Working Paper: Competing for Talents (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:147:y:2012:i:6:p:2190-2219

DOI: 10.1016/j.jet.2012.09.002

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