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Take the lead! An experimental analysis of leadership in team production

Take the lead! An experimental analysis of leadership in team production. Motivation Leadership in Team Production. Leaders may alleviate free riding under some conditions Leaders have the chance to exclude free riders, Guth et al. (2004) Leaders distribute earnings, Potters et al. (2006)

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Take the lead! An experimental analysis of leadership in team production

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  1. Take the lead!An experimental analysis of leadership in team production

  2. MotivationLeadership in Team Production • Leaders may alleviate free riding under some conditions • Leaders have the chance to exclude free riders, Guth et al. (2004) • Leaders distribute earnings, Potters et al. (2006) • They move first on the basis of additional information, Meidinger and Villeval (2002) • Leaders are endogenously determined and move first, Gächter and Renner (2005), Arbak and Villeval (2007) • Take the lead! • Endogenous leadership: anyone can be the leader • Horizontal game: Leaders and followers make the very same decisions • Leaders cannot sanction followers: No sanctions, no punishment, no informal peer pressure = low powered incentive system • Leading by example is endogenous, costless but strategically risky

  3. Motivation (II)Take the lead! • Endogenous leadership • Anyone can be the leader, in any period • Horizontal game • Leaders and followers make the very same decisions • Leaders cannot sanction followers • No sanctions, no punishment, no informal peer pressure = low powered incentive system • Leading by example • Example is based on available information • Becoming a leader is costless but strategically risky • A strong test for leading by example

  4. Experimental DesignThe game • A standard linear public goods game (VCM) • MPCR=.5; group size =4; 10+10 rounds; 50 tokens; partners • Croson, Fatas and Neugebauer (EL, 2005) • Treatments differ on the available information set • Follow the good leader treatment (FGL) • Available information: highest contribution • Follow the bad leader treatment (FBL) • Available information: lowest contribution • Natural baseline CFN • Available information: vector of contributions, no trace • Standard experimental procedures

  5. Results (I)Good leaders matter

  6. Results (I)Good leaders matter

  7. Results (II)Endogenous leadership

  8. Results (III)The role of information • Subjects do not follow good leaders, they pay attention to the bad ones

  9. Concluding remarks • Leadership significantly increases effort levels (contribution) • The usual PGG decline holds • Good leaders contribute significantly more, while bad leaders are not ashamed of their low contribution levels • Subjects follow bad leaders (instead of good ones) • “Don’t follow the leader, watch your parkimeter!” (Bob Dylan)

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