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The Disagreement Dividend

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  • Giampaolo Bonomi

Abstract

We study how disagreement influences team performance in a dynamic game with positive production externalities. Players can hold different views about the productivity of the available production technologies. This disagreement results in different technology and effort choices -- "optimistic" views induce higher effort than "skeptical" views. Views are changed when falsified by evidence. With a single technology available, optimists exert more effort early on if the team also includes skeptics. With sufficiently strong externalities, a disagreeing team produces, on average, more than any like-minded team. With multiple technologies, disagreement over which technology works best motivates everyone to exert more effort.

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  • Giampaolo Bonomi, 2023. "The Disagreement Dividend," Papers 2308.06607, arXiv.org, revised Jan 2024.
    • Handle: RePEc:arx:papers:2308.06607
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    References listed on IDEAS

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