@article{b2efef86414149e2b034bf7270d51d74,
title = "Matching information",
abstract = "We analyze the optimal allocation of experts to teams, where experts differ in the precision of their information, and study the assortative matching properties of the resulting assignment. The main insight is that in general it is optimal to diversify the composition of the teams, ruling out positive assortative matching. This diversification leads to negative assortative matching when teams consist of pairs of experts. And when experts' signals are conditionally independent, all teams have similar precision. We also show that if we allow experts to join multiple teams, then it is optimal to allocate them equally across all teams. Finally, we analyze how to endogenize the size of the teams, and we extend the model by introducing heterogeneous firms in which the teams operate.",
keywords = "Assortative matching, correlation, diversification, teams",
author = "Hector Chade and Jan Eeckhout",
note = "Funding Information: Hector Chade: hector.chade@asu.edu Jan Eeckhout: j.eeckhout@ucl.ac.uk We are grateful to three anonymous referees for their helpful comments. We have benefited from seminar audiences at UCL, Cambridge, Yale, UPF, Arizona State, Caltech, Wisconsin, Brigham Young, Indiana– IUPUI, Latin American Econometric Society Meetings, Society for Economic Dynamics, European Summer Symposium in Economic Theory at Gerzensee, Funda{\c c}{\~a}o Getulio Vargas Rio, Sidney, Edinburgh, Adelaide, Louvain, Essex, London Business School, Central European University, ITAM, Oxford, Rutgers, and Bocconi, as well as from comments by Federico Echenique, Ilse Lindenlaub, Alejandro Manelli, Giuseppe Moscarini, Meg Meyer, and Edward Schlee. Eeckhout gratefully acknowledges support from the ERC Grant 208068 and from MINECO-ECO2012-36200, and Chade is grateful to Universitat Pompeu Fabra for its hospitality where part of this research was conducted. Funding Information: We are grateful to three anonymous referees for their helpful comments. We have benefited from seminar audiences at UCL, Cambridge, Yale, UPF, Arizona State, Caltech, Wisconsin, Brigham Young, Indiana–IUPUI, Latin American Econometric Society Meetings, Society for Economic Dynamics, European Summer Symposium in Economic Theory at Gerzensee, Funda{\c c}{\~a}o Getulio Vargas Rio, Sidney, Edinburgh, Adelaide, Louvain, Essex, London Business School, Central European University, ITAM, Oxford, Rutgers, and Bocconi, as well as from comments by Federico Echenique, Ilse Lindenlaub, Alejandro Manelli, Giuseppe Moscarini, Meg Meyer, and Edward Schlee. Eeckhout gratefully acknowledges support from the ERC Grant 208068 and from MINECO-ECO2012-36200, and Chade is grateful to Universitat Pompeu Fabra for its hospitality where part of this research was conducted. Publisher Copyright: Copyright {\textcopyright} 2018 The Authors.",
year = "2018",
month = jan,
doi = "10.3982/TE1820",
language = "English (US)",
volume = "13",
pages = "377--414",
journal = "Theoretical Economics",
issn = "1933-6837",
publisher = "Society for Economic Theory",
number = "1",
}