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Sharing Information through Delegation and Collaboration

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  • Otto H. Swank

    ()
    (Faculty of Economics, Erasmus Universiteit Rotterdam)

  • Bauke Visser

    ()
    (Faculty of Economics, Erasmus Universiteit Rotterdam)

Abstract

This article analyzes under which conditions a manager can motivate a junior worker by verbal communication, and explains why communication is often tied up with organizational choices as job enlargement and collaboration. Our model has two important features. First, the manager has more information about a junior's ability than the junior himself. Second, the junior's effort and ability are complements. We show that the manager has an incentive to exaggerate the junior's ability. We discuss two ways in which the manager can make credible statements about the junior's ability. First, the senior can delegate a task to the junior for which it is important that the junior has a correct perception of his ability. Information is shared through a costless signal. Second, the senior can spend more time on a junior she perceives as able than on a junior she perceives as less able. Information is then shared through a costly signal.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 04-042/1.

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Date of creation: 00 0000
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Handle: RePEc:dgr:uvatin:20040042

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Web page: http://www.tinbergen.nl

Related research

Keywords: Communication; incentives; signalling; overconfidence; delegation; collaboration;

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  1. Henry Mintzberg, 1971. "Managerial Work: Analysis from Observation," Management Science, INFORMS, INFORMS, vol. 18(2), pages B97-B110, October.
  2. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Scholarly Articles 4554125, Harvard University Department of Economics.
  3. Luis Garicano, 2000. "Hierarchies and the Organization of Knowledge in Production," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 108(5), pages 874-904, October.
  4. Ben Hermalin, 1996. "Toward an Economic Theory of Leadership: Leading by Example," Working Papers, University of California at Berkeley, Haas School of Business _006, University of California at Berkeley, Haas School of Business.
  5. Joseph Farrell & Matthew Rabin, 1996. "Cheap Talk," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 10(3), pages 103-118, Summer.
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