Reputation without a Control Group

Shubh Lashkery and Georgy Lukyanov

No 26-1789, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: An adviser who warns that a task is difficult may become harder to evaluate when her advice is followed more thoroughly. We study a long-lived adviser and successive short-lived workers who choose between standard and intensive implementation. Standard implementation reveals whether the warning was correct and gives the next worker an opportunity to acquire cost-saving practical knowledge. Intensive implementation protects the project but produces only occasional evidence about the adviser. We construct a stationary sequential equilibrium in which the adviser initially accepts an informative implementation, withholds the next project after her reputation improves, and resumes recommendations once inherited know-how has been lost. The interruption is chosen because it changes the successor’s implementation decision: preserving knowhow reverses the adviser’s preference at the relevant history. All realized evidence remains public. Weak subsequent evidence eventually ends the low-ability adviser’s protection, but this can take a long time.

Keywords: reputation; career concerns; delegated implementation; organizational learning; knowledge transmission (search for similar items in EconPapers)
Date: 2026-10-16
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