Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/204930
Authors: 
Adrian, Nana
Möller, Marc
Year of Publication: 
2019
Series/Report no.: 
Discussion Papers 19-04
Abstract: 
This paper provides a rationale for equal sharing in heterogeneous partnerships. We introduce project choice and information sharing to a standard team production setting. A team with two agents can choose whether they want to work on a status quo project or on an alternative project. If the (expected) quality of the projects is given and common knowledge, it is optimal for team surplus to give a higher share to the more productive agent in order to optimally motivate. If agents have private information, we have to give the higher share of profits to the less productive agent if we want agents to share this information, which would allow for better adaptation. Equal revenue-sharing strikes a balance between the two objectives of adaptation and motivation and can be effcient even in the presence of considerable productivity dfferences across partners.
Subjects: 
Team adaptation
effort motivation
information disclosure
JEL: 
D2
D8
L2
Document Type: 
Working Paper

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