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Optimal sorting in group contests with complementarities

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  • Brookins, Philip
  • Lightle, John P.
  • Ryvkin, Dmitry

Abstract

Contests between groups of workers are often used to create incentives in organizations. Managers can sort workers into groups in various ways in order to maximize total output. We explore how the optimal sorting of workers by ability in such environments depends on the degree of effort complementarity within groups. For moderately steep costs of effort, we find that the optimal sorting is balanced (i.e., minimizing the variance in ability between groups) when complementarity is weak, and unbalanced (i.e., maximizing the variance in ability) when complementarity is strong. However, when the cost of effort is sufficiently steep, the optimal sorting can be unbalanced for all levels of complementarity or even alternate between unbalanced and balanced as the level of complementarity increases.

Suggested Citation

  • Brookins, Philip & Lightle, John P. & Ryvkin, Dmitry, 2015. "Optimal sorting in group contests with complementarities," Journal of Economic Behavior & Organization, Elsevier, vol. 112(C), pages 311-323.
  • Handle: RePEc:eee:jeborg:v:112:y:2015:i:c:p:311-323
    DOI: 10.1016/j.jebo.2015.02.006
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    Cited by:

    1. Francesco Trevisan, 2020. "Optimal prize allocations in group contests," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 55(3), pages 431-451, October.
    2. Cheikbossian, Guillaume, 2021. "Evolutionarily stable in-group altruism in intergroup conflict over (local) public goods," Games and Economic Behavior, Elsevier, vol. 127(C), pages 206-226.
    3. Guillaume Cheikbossian, 2019. "Evolutionarily stable in-group altruismin intergroup conflict," Working Papers halshs-02291876, HAL.
    4. Brookins, Philip & Lightle, John P. & Ryvkin, Dmitry, 2018. "Sorting and communication in weak-link group contests," Journal of Economic Behavior & Organization, Elsevier, vol. 152(C), pages 64-80.
    5. Gregor, Martin, 2015. "Task divisions in teams with complementary tasks," Journal of Economic Behavior & Organization, Elsevier, vol. 117(C), pages 102-120.
    6. Luke Boosey & Philip Brookins & Dmitry Ryvkin, 2020. "Entry in group contests," Working Papers wp2020_02_01, Department of Economics, Florida State University.
    7. Dongryul Lee & Joon Song, 2019. "Optimal Team Contests to Induce More Efforts," Journal of Sports Economics, , vol. 20(3), pages 448-476, April.
    8. Philip Brookins & John P. Lightle & Dmitry Ryvkin, 2015. "The effects of communication and sorting on output in heterogeneous weak-link group contests," Working Papers wp2014_01_01, Department of Economics, Florida State University.
    9. Brookins, Philip & Jindapon, Paan, 2021. "Risk preference heterogeneity in group contests," Journal of Mathematical Economics, Elsevier, vol. 95(C).

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    More about this item

    Keywords

    Group contest; Complementarity; Sorting; Heterogeneity;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management

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