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Birds of a Feather : Teams as a Screening Mechanism

Author

Listed:
  • Breton, M.
  • St-Amour, P.
  • Vencatachellum, D.

Abstract

This paper studies the informational content of elective teams in a dynamic principal/multiple-agents framework with adverse selection. Two agents with different employment histories are paid their conditional expected marginal product. They observe their types (good or bad), and choose between working together or separately. We characterize the distributions on agents' types, nature and wages such that teams are formed exclusively by good-type agents, with and without side payments. As employment records matter when idiosyncratic contributions are difficult to isolate, a good-type agent prefers not to jeopardize his reputation by teaming up with a bad-type agent.

Suggested Citation

  • Breton, M. & St-Amour, P. & Vencatachellum, D., 1998. "Birds of a Feather : Teams as a Screening Mechanism," Papers 9808, Laval - Recherche en Politique Economique.
    • Handle: RePEc:fth:lavape:9808
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    GAME THEORY ; ECONOMIC MODELS ; PRODUCTION;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets

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