Moral Hazard in Sequential Teams

Abstract: This paper considers a team in which production takes place sequentially and in which agents observe the actions taken by previous agents. We show that for such teams sharing rules exist which are balanced and induce efficient production as the unique equilibrium outcome. This in contrast to team structures studied by Holmström (1982) in which agents act simultaneously. The sharing rule which induces efficient production is simple, intuitive and robust to noise, sabotage, and collusive behavior. It induces efficient production even when agents obtain imperfect information about previous actions.

Keywords: Partnerships; Teams; unique implementation. (search for similar items in EconPapers)
JEL-codes: D82 L23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ias
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://userpage.fu-berlin.de/%7Elsbester/papers/seq_dp.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bef:lsbest:001

Access Statistics for this paper

More papers in Departmental Working Papers
Bibliographic data for series maintained by XXX ( this e-mail address is bad, please contact ).