Fostering Collaboration

34 Pages Posted: 5 Jun 2020

See all articles by Joyee Deb

Joyee Deb

Yale School of Management

Aditya Kuvalekar

Universidad Carlos III de Madrid

Elliot Lipnowski

Columbia University

Date Written: May 10, 2020

Abstract

We study project development and selection by an organization whose members prefer different projects. The organization faces a basic trade-off between fostering collaboration among its members and efficiently adapting its decisions to its circumstances. If the organization commits to choosing the project that is most profitable ex post, it undermines the members’ motive to collaborate, causing ex-ante inefficiency. We solve for the organization’s optimal selection rule. It entails an early phase of intense competition, followed by a permanent regime of collaboration. In service to ex-ante optimality, arbitrarily severe ex-post inefficiencies must be tolerated.

Keywords: project selection, internal competition, team production, mechanism design without transfers, strategic experimentation

JEL Classification: D73, D86, D72, D82

Suggested Citation

Deb, Joyee and Kuvalekar, Aditya and Lipnowski, Elliot, Fostering Collaboration (May 10, 2020). Available at SSRN: https://ssrn.com/abstract=3597730 or http://dx.doi.org/10.2139/ssrn.3597730

Joyee Deb

Yale School of Management ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States

Aditya Kuvalekar

Universidad Carlos III de Madrid ( email )

CL. de Madrid 126
Madrid, Madrid 28903
Spain

Elliot Lipnowski (Contact Author)

Columbia University ( email )

3022 Broadway
New York, NY 10027
United States

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