Sharing the Proceeds from a Hierarchical Venture

Jens Leth Hougaard, Juan D. Moreno-Ternero, Mich Tvede, Lars Peter Østerdal

Publikation: Working paper › Forskning

Resumé

We consider the problem of distributing the proceeds generated from a joint venture in which the participating agents are hierarchically organized. We introduce and characterize a family of allocation rules where revenue `bubbles up' in the hierarchy. The family is flexible enough to accommodate a no-transfer rule (where no revenue bubbles up) and a full-transfer rule (where all the revenues bubble up to the top of the hierarchy). Intermediate rules within the family are reminiscent of popular incentive mechanisms for social mobilization. Our benchmark model refers to the case of linear hierarchies, but we also extend the analysis to the case in which hierarchies may convey a general tree structure and include joint ownerships.
OriginalsprogEngelsk
Udgivelses stedLouvain
UdgiverCenter for Operations Research and Econometrics, Université Catholique de Louvain
Antal sider24
StatusUdgivet - jul. 2015
Udgivet eksterntJa
NavnCORE Discussion Paper
Nummer2015/31

Emneord

  • Hierarchies
  • Joint ventures
  • Resource allocation
  • Transfer rules
  • MIT strategy

Citer dette

Hougaard, J. L., Moreno-Ternero, J. D., Tvede, M., & Østerdal, L. P. (2015). Sharing the Proceeds from a Hierarchical Venture. Louvain: Center for Operations Research and Econometrics, Université Catholique de Louvain. CORE Discussion Paper, Nr. 2015/31
Hougaard, Jens Leth ; Moreno-Ternero, Juan D. ; Tvede, Mich ; Østerdal, Lars Peter. / Sharing the Proceeds from a Hierarchical Venture. Louvain : Center for Operations Research and Econometrics, Université Catholique de Louvain, 2015. (CORE Discussion Paper; Nr. 2015/31).
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Hougaard, JL, Moreno-Ternero, JD, Tvede, M & Østerdal, LP 2015 'Sharing the Proceeds from a Hierarchical Venture' Center for Operations Research and Econometrics, Université Catholique de Louvain, Louvain.

Sharing the Proceeds from a Hierarchical Venture. / Hougaard, Jens Leth; Moreno-Ternero, Juan D.; Tvede, Mich; Østerdal, Lars Peter.

Louvain : Center for Operations Research and Econometrics, Université Catholique de Louvain, 2015.

Publikation: Working paper › Forskning

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T1 - Sharing the Proceeds from a Hierarchical Venture

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AU - Østerdal, Lars Peter

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N2 - We consider the problem of distributing the proceeds generated from a joint venture in which the participating agents are hierarchically organized. We introduce and characterize a family of allocation rules where revenue `bubbles up' in the hierarchy. The family is flexible enough to accommodate a no-transfer rule (where no revenue bubbles up) and a full-transfer rule (where all the revenues bubble up to the top of the hierarchy). Intermediate rules within the family are reminiscent of popular incentive mechanisms for social mobilization. Our benchmark model refers to the case of linear hierarchies, but we also extend the analysis to the case in which hierarchies may convey a general tree structure and include joint ownerships.

AB - We consider the problem of distributing the proceeds generated from a joint venture in which the participating agents are hierarchically organized. We introduce and characterize a family of allocation rules where revenue `bubbles up' in the hierarchy. The family is flexible enough to accommodate a no-transfer rule (where no revenue bubbles up) and a full-transfer rule (where all the revenues bubble up to the top of the hierarchy). Intermediate rules within the family are reminiscent of popular incentive mechanisms for social mobilization. Our benchmark model refers to the case of linear hierarchies, but we also extend the analysis to the case in which hierarchies may convey a general tree structure and include joint ownerships.

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KW - MIT strategy

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KW - Resource allocation

KW - Transfer rules

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Hougaard JL, Moreno-Ternero JD, Tvede M, Østerdal LP. Sharing the Proceeds from a Hierarchical Venture. Louvain: Center for Operations Research and Econometrics, Université Catholique de Louvain. 2015 jul.

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