Article ID Journal Published Year Pages File Type
5061995 Economics Letters 2008 5 Pages PDF
Abstract

Agency models of multiple tasks typically assume independent outcomes. We show that correlation between outcomes can generate both economy and diseconomy of scale through diversification and competition effects. Additionally, the optimal compensation is non-monotone if the correlation is large.

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Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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Organizing multiple related tasks into jobs: Diversification vs. competition
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