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Black Sheep and Walls of Silence

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  • Gerd Muehlheusser
  • Andreas Roider

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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Bibliographic Info

Paper provided by Universitaet Bern, Departement Volkswirtschaft in its series Diskussionsschriften with number dp0410.

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Date of creation: Jun 2004
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Handle: RePEc:ube:dpvwib:dp0410

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

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Cited by:
  1. Dhammika Dharmapala & Thomas J. Miceli, 2012. "Search, Seizure and (False?) Arrest: An Analysis of Fourth Amendment Remedies when Police can Plant Evidence," Working papers 2012-37, University of Connecticut, Department of Economics.
  2. Mehmet Bac, 2009. "An economic rationale for firing whistleblowers," European Journal of Law and Economics, Springer, vol. 27(3), pages 233-256, June.

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