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Licensed Unlicensed Requires Authentication Published by De Gruyter August 11, 2006

Endogenous Favoritism in Organizations

  • Illoong Kwon

This paper shows that favoritism can arise endogenously as an optimal decision rule in a symmetric model with an ex-ante impartial principal. Furthermore, favoritism dominates fairness specifically when the favorite promotes his own idea and ignores the other's idea so that the non-favorite loses motivation. Our model also provides new insights on hierarchical communication structure and group authority.

Published Online: 2006-8-11

©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston

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