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Dream teams and the Apollo effect

Author

Listed:
  • Alex Gershkov

    (The Hebrew University of Jerusalem, Israel and University of Surrey, UK)

  • Paul Schweinzer

    (Department of Economics, Alpen-Adria-University Klagenfurt, Austria)

Abstract

We model leadership selection, competition, and decision making in teams with heterogeneous membership composition. We show that if the choice of leadership in a team is imprecise or noisy--which may arguably be the case if appointment decisions are made by non-expert administrators--then it is not necessarily the case that the best individuals should be selected as team members. On the contrary, and in line with what has been called the "Apollo effect," a "dream team" consisting of unambiguously higher-performing individuals may perform worse in terms of team output than a group composed of lower performers. We characterize the properties of the leadership selection and production processes that lead to the Apollo effect. Finally, we clarify when the opposite effect occurs in which supertalent performs better than comparatively less qualified groups.

Suggested Citation

  • Alex Gershkov & Paul Schweinzer, 2021. "Dream teams and the Apollo effect," The Journal of Mechanism and Institution Design, Society for the Promotion of Mechanism and Institution Design, University of York, vol. 6(1), pages 113-148, December.
  • Handle: RePEc:jmi:articl:jmi-v6i1a5
    DOI: 10.22574/jmid.2021.12.005
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    More about this item

    Keywords

    Team composition; leadership; mistakes.;
    All these keywords.

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • J80 - Labor and Demographic Economics - - Labor Standards - - - General

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