DP2552 Try Me! On Job Assignments as a Screening Device

Author(s): Juan D Carrillo
Publication Date: September 2000
Keyword(s): Career Concerns, Job Allocation, Personnel Economics, Relative Evaluation, Screening
JEL(s): D21, D73, D80, L22
Programme Areas: Public Economics, Industrial Organization
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=2552

We study the optimal allocation of screening tasks between two agents (incumbent vs. outsider or senior vs. junior) competing for one job. First, we characterize the inefficiencies from the principal's viewpoint of delegating the selection of the screening procedure to the incumbent. In general, the information disclosed by the screening tasks and the turnover rates will be inefficiently small due to the incumbent's willingness to undertake too many of these tasks. Second, we show that it may be optimal for organizations to favour the selection of outsider/junior agents relative to incumbent/senior ones because the former have greater implicit (career concern type) incentives than the latter to exert effort and perform efficiently.