Leadership and cooperation in growing teams

Abstract

AbstractWe study how the growth of teams affects leadership effectiveness and intragroup cooperation. We put experimental participants in two teams. In each team, the members voluntarily contribute to a club good. In one of the two teams, the members observe the contribution of a randomly chosen leader before they decide themselves. Two treatments allow for migration between the teams. In one of them, participants control access to their team with a voting process. By design, participants can achieve the efficient outcome only if they all move into one team. We compare the results with a leaderless setting as well as with four treatments which vary team size exogenously. The results show that high contributions of leaders encourage higher per‐capita contributions of their followers which foster migration into their teams. In turn, larger teams experience even more courageous leadership and higher contributions, but the coordination effect diminishes. Nevertheless, the dismissal of potential newcomers in the treatment with voting suggests that team members see a trade‐off between team size and contributions. They sacrifice economic benefits from potential entrants to maintain intrateam cooperation.