Sharing Information Through Delegation and Collaboration

Tinbergen Institute Discussion Paper No. TI 2004-042/1

37 Pages Posted: 20 May 2004

See all articles by Otto H. Swank

Otto H. Swank

Erasmus University Rotterdam - Department of Economics; Tinbergen Institute Rotterdam (TIR)

Bauke Visser

Erasmus University Rotterdam - Department of Economics; Tinbergen Institute Rotterdam (TIR)

Date Written: April 8, 2004

Abstract

This article analyzes under which conditions a manager can motivate a junior worker by verbal communication, and explains why communication is often tied up with organizational choices as job enlargement and collaboration. Our model has two important features. First, the manager has more information about a junior's ability than the junior himself. Second, the junior's effort and ability are complements. We show that the manager has an incentive to exaggerate the junior's ability. We discuss two ways in which the manager can make credible statements about the junior's ability. First, the senior can delegate a task to the junior for which it is important that the junior has a correct perception of his ability. Information is shared through a costless signal. Second, the senior can spend more time on a junior she perceives as able than on a junior she perceives as less able. Information is then shared through a costly signal.

Keywords: Communications, incentives, signalling, overconfidence, delegation, collaboration

JEL Classification: C70, D23, D83

Suggested Citation

Swank, Otto H. and Visser, Bauke, Sharing Information Through Delegation and Collaboration (April 8, 2004). Tinbergen Institute Discussion Paper No. TI 2004-042/1, Available at SSRN: https://ssrn.com/abstract=548223 or http://dx.doi.org/10.2139/ssrn.548223

Otto H. Swank

Erasmus University Rotterdam - Department of Economics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Tinbergen Institute Rotterdam (TIR)

P.O. Box 1738
3000 DR Rotterdam
Netherlands
+31 10 4081448 (Phone)
+31 10 2120551 (Fax)

Bauke Visser (Contact Author)

Erasmus University Rotterdam - Department of Economics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands
+ 31 (0)10 40 81449 (81441) (Phone)
+ 31 (0)10 40 89149 (Fax)

Tinbergen Institute Rotterdam (TIR)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

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