The Analysis Of Behavioral Choices Of Agents In The Team Production Based On Fairness Preference

The efficiency of team production has been the focus of people’s attention, it hasbeen a plagued problem for the principal how to effectively motivate agents to makemore contributions to team production. Many experts and scholars have done a lot ofresearches for this. For example, based on the purely selfish preference hypothesis ofagents, Holmstrom(1982)proved that in the team production both budget equilibriumand Pareto optimality were mutually exclusive; to solve the "free rider" problem, it wasnecessary to break the budget balance. But in recent years, a series of game experimentshave demonstrated convincingly that the agent are not purely selfish preference, theyalso have other preferences, such as fairness preference, risk aversion and so on.Therefore this paper will study the behavior choices of agents in the team production inthe context of the introduction of fairness preference, and research the team productivityof two kinds of decision-making structures under exogenous timing. Meanwhile, on thisbasis, this paper also introduces risk aversion, analyzing the behavior choice timing ofagents.By incorporating fairness preference into the utility function, this paper develops agame model of team production, which describing the ability and the fairnesssimultaneously, to probe the intrinsic mechanism by which the fairness preferenceinfluences the team efficiency under different game timings. Studies have shown that:one, introducing fairness preference, it is helpful to achieve the Pareto improvement ofteam production, thus to achieve the Pareto optimality. As long as with certainrestrictions, two types of fairness preference are able to promote the Paretoimprovement of team production. However, the restrictions of the Pareto improvementof team production are different for income fairness and motivation fairness. Incomefairness can achieve the Pareto improvement of team production, but in thesimultaneous game it is necessary that the ratio of agents’ ability is greater than theinverse of the ratio of income fairness intensity; in the sequential game it is necessarythat the less productive agent moves first and the productivities of agents are not toodifferent. In contrast, motivation fairness can have more substantial improvements inteam efficiency under more relaxed conditions, in the simultaneous game it is necessarythat at least one agent has motivation fairness; in the sequential game it is the only oneprerequisite that the second mover has motivation fairness. Second, relative to the simultaneous game, the sequential game can further promote the Pareto improvement ofteam efficiency. Third, in the simultaneous game, income fairness will form theconformity effect; in the sequential game, income fairness will form the commitmenteffect. Fourth, risk aversion of agents suppresses an increase in team output, and has anegative impact on team production, but theoretical studies have shown that thedisutility of risk aversion reducing team output is lower than the positive effect offairness preference increasing team output under certain conditions. Therefore, theprincipal should select agents who have motivation fairness to establish a team and toensure that agents move sequentially. It offers a new theoretical explanation for theexistence of the principal, and a new approach for team incentives.