Template-Type:ReDIF-Paper 1.0
Title: On Organizational Decision Rules and Innovative Activity
Author-Name: Sliwka, Dirk
Author-Postal: Dirk Sliwka
	Wirtschaftspolitische Abteilung
	University of Bonn
	Adenauerallee 24-26
	53113 Bonn
Author-Phone: 0211 789914
Author-Homepage: 
Classification-JEL: D23, L20
Keywords: Delegation, Decentralization, Incentives, Initiative, Decision Rules, Authority
Abstract: We analyze a model in which agents exert effort to create innovations within an organization. When payments are infeasible, the decision on the implementation of a proposal is shown to be made by simple monotonic decision rules. Then we look for optimal rules in several contexts. A trade-off arises between the use of information and the incentives created by a rule. If the former dominates it will currently be optimal to install a hierarchy. Otherwise granting autonomy to the innovators may be better. The unanimity rule may be optimal if average proposals are bad for the organization and a strong filtering is necessary.
Creation-Date: 1999-07
Revision-Date: 
Handle: RePEc:bon:bonsfa:601