We develop a model of team formation in which workers learn about their level of ability. We show that insufficient cooperation may arise as workers learn positively about their own skills. We then build a model for team managers and establish that their objectivity in assessing coworkers'...

We develop a principal-agent model with a moral hazard problem in which the principal has access to a hard signal (the level of output) and a soft signal (the supervision signal) about the agent?s level of effort. We show that the agent?'s ability to manipulate the soft signal increases the cost...

Abstract We study team formation in real-effort experiments in which participants bargain over a jointly produced outcome. Participants decide between undertaking a task alone or with another participant by releasing the minimum share of the future team outcome that they are willing to accept....

We study the effect of participative decision making in an experimental principalagent game, where the principal can consult the agent’s preferred option regarding the task to be undertaken in the final stage of the game. We show that consulting the agent was beneficial to principals as long...

Can “house money” explain asset market bubbles? We test this hypothesis in an asset experiment with a certain dividend cash and shares is given to subjects initial portfolios are constructed using subject that bubbles still occur; however trading volumes are significantly abated and the...

There exists extensive evidence that people learn positively about themselves. We build on this finding to develop a model of team formation in the workplace. We show that learning positively about oneself systematically undermines the formation of teams. Agents becoming overconfident tend to...

We use peer assessments as a tool to allocate joint profits in a real effort team experiment. We find that using this incentive mechanism reduces team performance. More specifically, we show that teams composed of fellows rather than strangers actually underperform in a context of peer...

We develop a model of team formation in which workers learn about their level of ability. We show that insufficient cooperation may arise as workers learn positively about their own skills. We then build a model for team managers and establish that their objectivity in assessing coworkers'...

We develop a principal-agent model in which the principal has access to hard and soft information about the agent’s level of effort. We model the soft signal as being informative about the agent’s level of effort but manipulable by the agent at a cost. We show that the presence of influence...