Multiple Tasks and Political Organization

9 Pages Posted: 4 Oct 2014 Last revised: 7 Mar 2015

Date Written: December 6, 2014

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

JEL Classification: H1, M5

Suggested Citation

Hamami, Tom, Multiple Tasks and Political Organization (December 6, 2014). Economics Letters, Volume 128, March 2015, p. 48-50., Available at SSRN: https://ssrn.com/abstract=2504767 or http://dx.doi.org/10.2139/ssrn.2504767

Tom Hamami (Contact Author)

Northwestern University, Department of Managerial Economics and Decision Sciences (MEDS), Students ( email )

Evanston, IL
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
32
Abstract Views
309
PlumX Metrics