Rank Uncertainty in Organizations (joint with Marina Halac & Daniel Rappoport)
This workshop will take place on Zoom
A principal incentivizes a team of agents to work by privately offering them bonuses contingent on team success. We study the principal’s optimal incentive scheme that implements work as a unique equilibrium. This scheme leverages rank uncertainty to address strategic uncertainty. Each agent is informed only of a ranking distribution and his own bonus, the latter making work dominant provided that higher-rank agents work. If agents are symmetric, their bonuses are identical. Thus, discrimination is strictly suboptimal, in sharp contrast with the case of public contracts (Winter, 2004). We characterize how agents’ ranking and compensation vary with asymmetric effort costs.

Link to paper: elliotlipnowski.com/wp-content/uploads/2020/04/HLR_April2020.pdf

Please sign up for meetings here: docs.google.com/spreadsheets/d/1l_CJXAOQGvxYdmXIOrmhV9c9OFr3yNuwe2UsBfEGs98/edit#gid=0
Date: 19 May 2020, 12:45 (Tuesday, 4th week, Trinity 2020)
Venue: Venue to be announced
Speaker: Elliot Lipnowski (Columbia University)
Organising department: Department of Economics
Part of: Economic Theory Workshop
Booking required?: Not required
Audience: Members of the University only
Editor: Melis Clark