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Black Sheep and Walls of Silence

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Author Info
Gerd Mühlheusser (University of Bern, Department of Economics, Gesellschaftsstrasse 49, 3012 Bern, Switzerland, gerd.muehlheusser@vwi.unibe.ch)
Andreas Roider (University of Bonn, Department of Economics, Wirtschaftspolitische Abteilung, Adenauerallee 24-42, 53113 Bonn, Germany, roider@uni-bonn.de)

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Abstract

In this paper we analyze the frequently observed phenomenon that (i) some members of a team (“black sheep”) exhibit behavior disliked by other (honest) team members, who (ii) nevertheless refrain from reporting such misbehavior to the authorities (they set up a “wall of silence”). Much cited examples include hospitals and police departments. In this paper, these features arise in equilibrium. An important ingredient of our model are benefits that agents receive when cooperating with each other in a team. Our results suggest that teams in which the importance of these benefits varies across team members are especially prone to the above mentioned phenomenon.

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Publisher Info
Paper provided by SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich in its series Discussion Papers with number 56.

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Date of creation: Jun 2005
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Handle: RePEc:trf:wpaper:56

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Related research
Keywords: teams; misbehavior; wall of silence; asymmetric information;

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Find related papers by JEL classification:
D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information
C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

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