Dynamic delegation in promotion contests
I study how organizations assign tasks to identify the best candidate to promote among a pool of workers. Task allocation and workers’ motivation interact through the organization’s promotion decisions. The organization designs the workers’ careers to both screen and develop talent. When only non-routine tasks are informative about a worker’s type and non-routine tasks are scarce, the organization’s preferred promotion system is an index contest. Each worker is assigned a number that depends only on his own type. The principal delegates the non-routine task to the worker whose current index is the highest and promotes the first worker whose type exceeds a threshold. Each worker’s threshold is independent of the other workers’ types. Competition is mediated by the allocation of tasks: who gets the opportunity to prove themselves is a determinant factor in promotions. Finally, features of the optimal promotion contest rationalize the prevalence of fast-track promotion, the role of seniority, or when a group of workers is systemically advantaged.
Date: 11 June 2024, 12:45 (Tuesday, 8th week, Trinity 2024)
Venue: Nuffield College, New Road OX1 1NF
Venue Details: Chester Room or https://zoom.us/j/92241183272?pwd=NzBhTVg1d1g5Sm1NRnQ4cU1iS1NmZz09
Speaker: Theo Durandard (University of Illinois)
Organising department: Department of Economics
Part of: Economic Theory Workshop
Booking required?: Not required
Audience: Members of the University only
Editor: Edward Clark