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Competitive Screening of a Heterogeneous Labor Force and Corporate Teamwork Attitude

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  • Agnieszka Tymula

Abstract

The aim of this paper is to analyze the influence of competition on the structure of incentive schemes, workforce composition, and the degree of cooperation within firms. We show that in equilibrium high-skilled workers, in order to distinguish themselves from the low-skilled, choose the incentive schemes that strongly rely on their own as well as their teammates' performance. They work harder on their own task and are more team-oriented than low-skilled workers. Our paper stresses the sorting role of the incentives and provides a rationale for the emergence of different corporate teamwork practices.

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  • Agnieszka Tymula, 2017. "Competitive Screening of a Heterogeneous Labor Force and Corporate Teamwork Attitude," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 173(3), pages 523-547, September.
  • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(201709)173:3_523:csoahl_2.0.tx_2-9
    DOI: 10.1628/093245616X14793640933401
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    Cited by:

    1. Bannier, Christina E. & Feess, Eberhard & Packham, Natalie, 2014. "Incentive schemes, private information and the double-edged role of competition for agents," CFS Working Paper Series 475, Center for Financial Studies (CFS).
    2. Roland Bénabou & Jean Tirole, 2016. "Bonus Culture: Competitive Pay, Screening, and Multitasking," Journal of Political Economy, University of Chicago Press, vol. 124(2), pages 305-370.

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    More about this item

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

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