Team Governance: Empowerment or Hierarchical Control

Guido Friebel (1) , Wendelin Schnedler (2)

1 Frankfurt University
2 Heidelberg University and IZA

We investigate the costs and bene_ts of managerial interventions with a team in which workers care to di_erent degrees about output. We show that if there are complementarities in production and if the team manager has some information about team members, interventions by the manager may have destructive e_ects: they can distort how workers perceive their co-workers and may lead to a reduction of e_ort by those workers who care most about output. Moreover, interventions may hinder the development of a cooperative organizational culture in which workers trust each other.

Mots clés: team work; incentives; informed principal; intrinsic motivation

Domaines: Économie et finance quantitative [q-fin]

Guido Friebel, Wendelin Schnedler. Team Governance: Empowerment or Hierarchical Control. Journal of Economic Behavior and Organization, 2011, 78 (1-2), pp.1. ⟨10.1016/j.jebo.2010.12.003⟩. ⟨hal-00978261⟩