Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/232419 
Year of Publication: 
2021
Series/Report no.: 
CESifo Working Paper No. 8822
Publisher: 
Center for Economic Studies and Ifo Institute (CESifo), Munich
Abstract: 
Following Garicano (2000), we consider groups whose members decide what knowledge to acquire and how to use this knowledge in production. If efficient production requires common knowledge, all group members should become workers and acquire common knowledge. But if efficient production requires diverse knowledge, one group member should become manager, acquire rare knowledge, and stand ready to help the other workers. In our laboratory experiment, we find that most groups eventually manage to coordinate on an efficient division of labor. Still, we find substantial adoption frictions. Coordination takes time, and some groups coordinate on an inefficient division of labor, probably because they do not understand what organization of knowledge is most efficient.
Subjects: 
knowledge
division of labor
organizational economics
JEL: 
C72
C92
D20
L23
M20
Document Type: 
Working Paper
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