Corporate Downsizing to Rebuild Team Spirit
نویسندگان
چکیده
We propose a new theory for downsizing, based on strategic reasons, rather than technological ones. A crisis may lead to a decrease in the willingness to cooperate in an organization, and therefore to a bad equilibrium. A consensual downsizing episode may signal credibly that survivors are willing to cooperate, and thus, it may be optimal and efficiency-enhancing, as the empirical evidence suggests. A variation of the same mechanism leads to “efficient” upsizing. ∗We gratefully acknowledge the financial help from Fundación BBVA, from the Spanish Ministry of Science and Technology under grants BEC2000-1029 and BEC2002-2130, and from the Barcelona Economics Program of CREA. We thank Gary Charness, Matt Jackson, Joel Shapiro, Joel Sobel, Fernando VegaRedondo and various seminar audiences for their helpful comments. The usual disclaimer applies. †Departament d’Economia i Empresa, Universitat Pompeu Fabra, Ramon Trias Fargas 25-27, 08005 Barcelona, Spain. Email: [email protected] ‡Universitat Autònoma de Barcelona, Department of Economics, Edifici B, 08193 Bellaterra (Barcelona), Spain. Email: [email protected]. http://selene.uab.es/acalvo 1 Barcelona Economics WP no 183
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