Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/56331
Authors: 
Segendorff, Björn
Year of Publication: 
2000
Series/Report no.: 
SSE/EFI Working Paper Series in Economics and Finance 407
Abstract: 
A separating equilibrium in which competent (incompetent) leaders choose competent (incompetent) co-workers is investigated. An outside observer rewards the leader at good policy outcomes. The incompetent co-worker can, at bad outcomes, be used as scapegoat. By assumption, the leader may fail in blaming the scapegoat. Two different assumptions on the outside observer's information set are compared. If she cannot observe a failed attempt, the separating equilibrium exists only if two non-mimicking constraints are met. If she can observe a failed attempt, an additional constraint is added due to the possibility of partial mimicking.
Subjects: 
Separating equilibrium
competence
transparency
co-worker
blame
JEL: 
C72
D72
D82
J33
Document Type: 
Working Paper

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