First in Village or Second in Rome
AbstractThough individuals prefer to join groups with high quality peers, there are also advantages from being high up in the pecking order within the group. We show that sorting of agents in this environment results in an overlapping interval structure in the type space. Segregation and mixing coexist in a stable equilibrium. A greater degree of egalitarianism within organizations leads to greater segregation across organizations. Policies that are effective for lower-quality organizations to attract talent may be counterproductive for higher-quality organizations to retain talent. The degree and the pattern of segregation are shown to depend also on whether higher types are less concerned with relative ranking within the organization, on relative size of organizations, and on the extent of idiosyncratic preferences for other organizational attributes.
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Bibliographic InfoPaper provided by University of Toronto, Department of Economics in its series Working Papers with number tecipa-221.
Date of creation: 11 Sep 2004
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Other versions of this item:
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- M50 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-04-08 (All new papers)
- NEP-SOC-2006-04-08 (Social Norms & Social Capital)
- NEP-URE-2006-04-08 (Urban & Real Estate Economics)
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