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Teamwork efficiency and company size

Galashin, Mikhail and Popov, Sergey V. ORCID: https://orcid.org/0000-0001-6899-9293 2016. Teamwork efficiency and company size. The B.E. Journal of Theoretical Economics 16 (1) , pp. 337-366. 10.1515/bejte-2014-0040

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Abstract

We study how ownership structure and management objectives interact in determining the company size without assuming information constraints or any explicit costs of management. In symmetric agent economies, the optimal company size balances the returns to scale of the production function and the returns to collaboration efficiency. For a general class of payoff functions, we characterize the optimal company size, and we compare the optimal company size across different managerial objectives. We demonstrate the restrictiveness of common assumptions on effort aggregation (e.g., constant elasticity of effort substitution), and we show that common intuition (e.g., that corporate companies are more efficient and therefore will be larger than equal-share partnerships) might not hold in general.

Item Type: Article
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Publisher: De Gruyter
ISSN: 2194-6124
Date of First Compliant Deposit: 9 October 2017
Last Modified: 16 Nov 2023 19:16
URI: https://orca.cardiff.ac.uk/id/eprint/103244

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