Job design, delegation and cooperation: A principal-agent analysis

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54 Citations (Scopus)

Abstract

This paper analyzes how tasks are assigned in organizations. Tasks can be allocated vertically between a principal and an agent, or laterally among agents. The resulting organizational job design determines how many tasks are delegated to agents, and how the agents' tasks are divided among them. In the framework of the standard principal-agent relationship with moral hazard, it is shown that (i) an incentive consideration causes the principal to group a broad range of tasks into an agent's job rather than hire multiple agents and make each of them specialize in just one task; and (ii) the principal may choose to delegate all the tasks in order to mitigate a conflicting incentive problem with agents.

Original languageEnglish
Pages (from-to)691-700
Number of pages10
JournalEuropean Economic Review
Volume38
Issue number3-4
DOIs
Publication statusPublished - 1994 Apr

Keywords

  • Delegation
  • Job design
  • Principal-agent relationship
  • Task overlap
  • Team production

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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