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  • Seminar,

Maxime Menuet (CERDI)

Published on November 29, 2018 Updated on November 30, 2018
Le 04 December 2018 De 12:30 à 13:15
Pôle Tertiaire - Site La Rotonde - 26 avenue Léon Blum - 63000 Clermont-Ferrand
Room 210

Reputation and the "Need for Enemies"


Reputation to be competent in solving some problem is useful only if the problem remains in the future. Hence, the incentive to keep the “enemy” alive: an agent may do wrong in his job precisely because he is competent. The paper develops this
mechanism in a general career concerns framework, and shows that a tradeoff between reputation and the need for enemies emerges. As a result, agents are induced to produce only moderate effort and only moderately-skilled agents are likely to be
appointed. Implications of the analysis are discussed in a multitasking environment with incomplete transparency. Some evidences in principal-agent relationships and political arena are presented to illustrate our theory.

Donwload the paper (Pdf)