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Working Papers


   Regulating Spillovers in Teamwork  (with Huseyin Yildirim)

Abstract: We study team incentives with positive spillovers and rewards based on ex-post public credit for individual contributions to collective success. Compared to ex-ante optimal credit allocation, higher-ability or lower-cost agents are over-credited ex-post and, thus, over-motivated for team success when the spillover rate is too low and under-credited/under-motivated when it is too high. Therefore, organizations may limit communication and transparency between team members to induce optimal effort. Alternatively, they may carefully select team members to diffuse credit-sharing concerns. These concerns also make lower-ability agents less likely to invite collaborators or choose the most capable for their projects.