We consider a situation in which teams of totally identical members compete for several indivisible prizes. Prize allocation across teams is a function of team production. Team production may exhibit complementarities, and the individual cost of effort may be more or less convex. Within teams, effort choices are observable or not. We compare an intra-team prize allocation system that treats team members equally to one that generates artificial differences between members (e.g. an alphabetical list system). Further, using mechanism design, we study the conditions under which a non-monotonic allocation system may be optimal.
(This is joint work with Sabine Flamand (Roviri i Virgili) and Nicolas Sahuguet (HEC Montreal))