Team Production and the Problem of Cooperation

The ideas discussed in the three articles are interesting, they are about how people share belongings, how people perceive fairness, and how people act altruistically. I believe that these ideas are not only important on observing human behaviors, but can also be handy when applying them in organizations. Before I continue the discussion of the articles, I want to talk something I learned about people’s “identity” in our course project and previous posts.

According to the paper I read in preparation for the course project, Identity and the Economics of Organizations, Akerlof and Kranton (2005) assert that people’s identity could influence their behaviors, which I think is highly correlated with the topics of the three articles. There are normally two identities, one is “insider” and another one is “outsider”. Insiders are keen on achieve goals aligned with their social category. Outsiders, on the contrary, are more likely to act against insiders’ interests. Social category divides people into groups based on ethnic, gender, etc. For example, auto insurance company divides customers based on their genders. The company finds that female drivers in average drive safer and seldom have car accidents, in our terms, they are insiders of the company. Male drivers, however, drive more audacious and get involved at more car accidents; in this case, the company considers male drivers as outsiders since the more money the company has to compensate male drivers.

So, what can I apply the identity theory to the three articles? In the first article, the authors found that children are more willing to share when they realize that they need to cooperate with other children to earn the rewards. My interpretation is, children learn that other cooperative children are insiders of their interest, and they cannot access the reward without other children. Children are therefore share with those insiders who help them to achieve the goal. In other circumstances, children find that their interest are not depend on others help and are reluctant to share their belongings. Children believe that their gain comes from their own hard work (it is obvious they cannot tell that sometimes they earn more by luck). The result is that children are not going to share with those children whom are considered as outsiders. Use the car insurance company example again, we can observe that insiders are provided, or share, with more discounts and outsiders need to pay higher premium.

In the second article which is discussing fairness, the authors conclude that fairness dose not necessary to be fair. The best solution to solve children’s squabble of unfairness is to give them what they want most. This article is related to the identity theory and also to opportunistically behaviors that parents can do. What I learn from this article is, parents can base on children’s identity and give them minimum rewards, which is similar to price discrimination. For instance, parents who are struggling to buy their children Christmas presents can use this strategy: get each child the gift which costs least but value most for that kid. The strategy sounds a little opportunistic for me since it cost less money and every child is satisfied without arguing: “This is unfair!”.

The third article is arguing that people are actually altruistic, unlike what economists assume that people only care about self-interest. The finding of the article is that people sometimes act altruistic without expecting any reward. Moreover, any economic transactions can ruin people’s intention to be altruist. I find the identity theory can apply in this article as well. I believe that people act altruistically is because they are able to distinguish who is insider. Take the kindergarten example in the article, parents come to pick up their children on time or a little bit late since they consider staffs in the kindergarten are insiders who care about their children as well. Once the kindergarten decides to fine parents who show up late, this action change staffs’ identity from insiders to outsiders. Now parents think kindergarten’s staffs are only selling nursing service and don’t really care about children.

These three articles give me an idea about what I can do in a group work that I will probably confront in the future. As I mentioned in the previous posts, I believe that good teamwork should base on right task assignments, and managers should assign task according to employees’ comparative advantages. Use the terms I just discussed, knowing employees’ comparative advantages means that workers’ identities are observed. However, knowing their identities doesn’t mean they are willing to comply with managers. That is the problem also happened in group works. Sometimes your teammates’ abilities are easily observed, but when it comes to job assignment, they seem not willing to do what they are good at. Everyone just wants to do jobs as less as possible.

To solve the uncooperative problem, the solution we learned from the three articles is to trigger participants to be willing to cooperate. Which also means to change their identities from outsiders to insiders. One reason that teammates are reluctant to take assigned jobs is because they don’t feel part of the team. Some motivations can, theoretically, change this situation, such as friendly cheer ups or reminders. Once you change your teammates’ identities from outsiders to insiders, the higher chance they will share you their diligence on work.

References

Akerlof, G. A., & Kranton, R. E. (2005). Identity and the Economics of Organizations. Journal of Economics Perspectives, 19, 9-32.