Privilege-Seeking Activities in Organizational Politics and Its Effect on More Productive Employees

Gil Epstein and Bruce C. Herniter
Additional contact information
Bruce C. Herniter: DeVry University

No 2011-23, Working Papers from Bar-Ilan University, Department of Economics

Abstract: The ability to accurately evaluate an employee would seem to be a key activity in managing Information Technology (IT). Yet, workers may engage in dishonest and misleading behavior, which distort the evaluation, a variation of organizational politics. Why would they do so? One hypothesis is that “privilege-seeking”, that is, managing one’s managers (also called “rent-seeking”, “management relations”, or “organizational politics”), can be used by a worker to misrepresent his actual contribution. These activities lead to a reduction in productivity and consequently to a loss of profits. Management may decrease the firm’s losses by engaging in costly monitoring activities. It is paradoxical that a behavior with such negative consequences is tolerated. A model is developed to show that an organization should be composed of employees with different levels of productivity; moreover, it may be optimal for the organization to have some employees who are good at privilege-seeking activities, forcing the remaining workers to invest in productive activities. This contradicts existing theory that unequal compensation should be less motivating and the remaining workers less productive.

Keywords: Employee evaluation; equity theory; influence costs; management relations; multiple agent model; monitoring; Nash equilibrium; privilege-seeking activities; rent; rent-seeking (search for similar items in EconPapers)
Pages: 31 pages
Date: 2011-08
References: Add references at CitEc
Citations:

Downloads: (external link)
https://econ.biu.ac.il/sites/econ/files/working-papers/2011-23.pdf Working paper (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:biu:wpaper:2011-23

Access Statistics for this paper

More papers in Working Papers from Bar-Ilan University, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Department of Economics ().