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Competing for Talents

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Author Info
Damiano, Ettore
Li, Hao
Suen, Wing

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Abstract

Though individuals prefer to join groups with high quality peers, there are advantages to being high up in the pecking order within a group if higher ranked members of a group have greater access to the group's resources. When two organizations try to attract members from a ¯xed population of heterogeneous agents, how resources are distributed among the members according to their rank a®ects how agents choose between the organizations. Competition between the two organizations has implications for both the equilibrium sorting of agents and the way resources are distributed within each organization. To compete more intensely for the more talented agents, both organizations are selective and give no resources to their low ranks. In both organizations, higher ranks are rewarded with more resources, with a greater rate of increase in the organization that has a lower average quality in equilibrium.

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Paper provided by Microeconomics.ca Website in its series Micro Theory Working Papers with number damiano-06-01-17-02-01-48.

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Length: 38 pages
Date of creation: 17 Jan 2006
Date of revision: 17 Jan 2006
Handle: RePEc:ubc:pmicro:damiano-06-01-17-02-01-48

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  8. Damiano, Ettore & Li, Hao & Suen, Wing, 2005. "First in village or second in Rome?," Micro Theory Working Papers damiano-05-01-25-10-14-13, Microeconomics.ca Website, revised 26 Jan 2005. [Downloadable!]
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  11. de Bartolome, Charles A M, 1990. "Equilibrium and Inefficiency in a Community Model with Peer Group Effects," Journal of Political Economy, University of Chicago Press, vol. 98(1), pages 110-33, February. [Downloadable!] (restricted)
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