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Team governance: Empowerment or hierarchical control

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  • Friebel, Guido
  • Schnedler, Wendelin

Abstract

We investigate the costs and benefits of managerial interventions with a team in which workers care to different degrees about output. We show that if there are complementarities in production and if the team manager has some information about team members, interventions by the manager may have destructive effects: they can distort how workers perceive their co-workers and may lead to a reduction of effort by those workers who care most about output. Moreover, interventions may hinder the development of a cooperative organizational culture in which workers trust each other.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 78 (2011)
Issue (Month): 1-2 (April)
Pages: 1-13

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Handle: RePEc:eee:jeborg:v:78:y:2011:i:1-2:p:1-13

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Web page: http://www.elsevier.com/locate/jebo

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Keywords: Team work Incentives Informed principal Intrinsic motivation;

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  1. Cho, In-Koo & Kreps, David M, 1987. "Signaling Games and Stable Equilibria," The Quarterly Journal of Economics, MIT Press, vol. 102(2), pages 179-221, May.
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Citations

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Cited by:
  1. Schnedler, Wendelin & Vanberg, Christoph, 2014. "Playing 'Hard to Get': An Economic Rationale for Crowding Out of Intrinsically Motivated Behavior," Working Papers 0559, University of Heidelberg, Department of Economics.
  2. Wendelin Schnedler, 2011. "You Don't Always Get What You Pay For: Bonuses, Perceived Income and Effort," German Economic Review, Verein für Socialpolitik, vol. 12(1), pages 1-10, 02.
  3. Grout, Paul & Schnedler, Wendelin, 2008. "Non-Profit Organizations in a Bureaucratic Environment," IZA Discussion Papers 3685, Institute for the Study of Labor (IZA).
  4. Herold, Florian, 2010. "Contractual incompleteness as a signal of trust," Games and Economic Behavior, Elsevier, vol. 68(1), pages 180-191, January.
  5. Schnedler, Wendelin & Vadovic, Radovan, 2007. "Legitimacy of Control," IZA Discussion Papers 3013, Institute for the Study of Labor (IZA).
  6. Danilov, Anastasia & Sliwka, Dirk, 2013. "Can Contracts Signal Social Norms? Experimental Evidence," IZA Discussion Papers 7477, Institute for the Study of Labor (IZA).
  7. Roberto Galbiati & Karl Schlag & Joel van der Weele, 2011. "Sanctions that Signal: an Experiment," Vienna Economics Papers 1107, University of Vienna, Department of Economics.
  8. von Siemens, Ferdinand A., 2013. "Intention-based reciprocity and the hidden costs of control," Journal of Economic Behavior & Organization, Elsevier, vol. 92(C), pages 55-65.
  9. Kamphorst, Jurjen J.A. & Swank, Otto H., 2013. "When Galatea cares about her reputation: How having faith in your workers reduces their motivation to shine," European Economic Review, Elsevier, vol. 60(C), pages 91-104.

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