Cooperation and the Boundaries of the Firm: A Framed-Field Experiment

18 Pages Posted: 21 Oct 2014

See all articles by Béatrice Boulu-Reshef

Béatrice Boulu-Reshef

Université Paris I Panthéon-Sorbonne - Centre d'Economie de la Sorbonne (CES)

Date Written: October 20, 2014

Abstract

This paper studies the effect of firm boundaries on inter-individual cooperation in corporate settings. I conduct a framed-field linear public good game experiment in the natural environment of the workplace. I use information about the actual boundaries of two firms, which are a parent firm and its subsidiary. I document differences in the overall level of cooperation across the parent firm, its subsidiary, and an intra-corporate group that comprises players from both the parent firm and the subsidiary. In stark contrast to previous results, I find that cooperation is increasing over time within the parent firm, indicating that firms can foster stronger cooperation within their boundaries. In other treatments the standard declining cooperation is not rejected. Overall, I find higher levels of contribution to the public good relative to conventional laboratory experiments. I estimate the importance of individuals' identity and find that higher weight placed on identity is associated with higher contributions, but only within the parent firm. Higher levels of self-awareness can help explain patterns of cooperation within the boundaries of the firm.

Keywords: Cooperation, firm boundaries, identity, public good game, framed-field experiment.

JEL Classification: C93, D2, H41, L2.

Suggested Citation

Boulu-Reshef, Béatrice, Cooperation and the Boundaries of the Firm: A Framed-Field Experiment (October 20, 2014). Darden Business School Working Paper No. 2512374. Available at SSRN: https://ssrn.com/abstract=2512374 or http://dx.doi.org/10.2139/ssrn.2512374

Béatrice Boulu-Reshef (Contact Author)

Université Paris I Panthéon-Sorbonne - Centre d'Economie de la Sorbonne (CES) ( email )

106-112 Boulevard de l'hopital
106-112 Boulevard de l'Hôpital
Paris Cedex 13, 75647
France

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