on the efficiency of team-based meritocracies
AbstractAccording to theory a pure meritocracy is efficient because individual members are competitively rewarded according to their individual contributions to society. However, purely individually based meritocracies seldom occur. We introduce a new model of social production called “team-based meritocracy” (TBM) in which individual members are rewarded based on their team membership. We demonstrate that as long as such team membership is both mobile and competitively based on contributions, individuals are able to tacitly coordinate a complex and counterintuitive asymmetric equilibrium that is close to Pareto-optimal, possibly indicating that such a group-based meritocracy could be a social structure to which humans respond with particular ease. Our findings are relevant to many contemporary societies in which rewards are at least in part determined via membership in organizations such as for example firms, and organizational membership is increasingly determined by contribution rather than privilege.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 8627.
Date of creation: 07 Jan 2008
Date of revision:
social stratification; meritocracies; mechanism design; non-cooperative games; experiment; team production;
Find related papers by JEL classification:
- D20 - Microeconomics - - Production and Organizations - - - General
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-05-10 (All new papers)
- NEP-CBE-2008-05-10 (Cognitive & Behavioural Economics)
- NEP-EXP-2008-05-10 (Experimental Economics)
- NEP-GTH-2008-05-10 (Game Theory)
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