Teamwork Efficiency and Company Size

Mikhail Galashin and Sergey Popov

MPRA Paper from University Library of Munich, Germany

Abstract: We study how ownership structure and management objectives interact in determining the company size without assuming information constraints or explicit costs of management. In symmetric agent economies, the optimal company size balances the returns to scale of the production function and the returns to collaboration efficiency. For a general class of payoff functions, we characterize the optimal company size, andwe compare the optimal company size across different managerial objectives. We demonstrate the restrictiveness of common assumptions on effort aggregation (e.g., constant elasticity of effort substitution), andwe showthat common intuition (e.g., that corporate companies are more efficient and therefore will be larger than equal-share partnerships) might not hold in general.

Keywords: team; partnership; effort complementarities; firm size (search for similar items in EconPapers)
JEL-codes: D02 D2 J5 L11 (search for similar items in EconPapers)
Date: 2014-06-19
New Economics Papers: this item is included in nep-hrm and nep-mic
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Related works:
Journal Article: Teamwork Efficiency and Company Size (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:58540

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