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Team governance: Empowerment or hierarchical control

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  • Friebel, Guido
  • Schnedler, Wendelin

Abstract

We investigate the costs and benefits of managerial interventions with a team in which workers care to different degrees about output. We show that if there are complementarities in production and if the team manager has some information about team members, interventions by the manager may have destructive effects: they can distort how workers perceive their co-workers and may lead to a reduction of effort by those workers who care most about output. Moreover, interventions may hinder the development of a cooperative organizational culture in which workers trust each other.

Suggested Citation

  • Friebel, Guido & Schnedler, Wendelin, 2011. "Team governance: Empowerment or hierarchical control," Journal of Economic Behavior & Organization, Elsevier, vol. 78(1-2), pages 1-13, April.
    • Handle: RePEc:eee:jeborg:v:78:y:2011:i:1-2:p:1-13
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    More about this item

    Keywords

    Team work Incentives Informed principal Intrinsic motivation;

    JEL classification:

    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management
    • D86 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Economics of Contract Law

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