Helping behavior in networked organizations

Abstract

This article studies a networked organization in which agents work to directly increase the team’s output and help neighbors to reduce the disutility of working. I build a tractable framework to analyze the complexity of mutual help that cannot be simply characterized as strategic complements or substitutes, and the relationship between the structure of social networks within an organization and its efficiency. I establish the existence and uniqueness of the equilibrium of a two-stage game in which agents first decide how much helping effort to give to each neighbor, and, then, how much effort to expend to directly benefit the team. I show that denser networks might not necessarily sustain a higher level of help, because links might be redundant. If the agents are homogeneous, the network in which they are pairwise connected reaches the highest efficiency with the fewest links.