Sharing Credit for Joint Research

TL;DR

This paper explores efficient payoff sharing mechanisms in risky joint research, demonstrating that simple, effort-based credit allocations can achieve efficiency even with limited observability and non-contractible winner identity.

Contribution

It introduces minimal-information mechanisms that effectively address inefficiencies in strategic experimentation by allocating payoffs asymmetrically and based on effort at breakthrough.

Findings

Asymmetric payoff allocation achieves efficiency.

Effort-based credit sharing suffices when winner's identity is non-contractible.

Simple mechanisms are robust and effective in strategic research settings.

Abstract

How can one efficiently share payoffs with collaborators when participating in risky research? First, I show that efficiency can be achieved by allocating payoffs asymmetrically between the researcher who makes a breakthrough ("winner") and the others, even if agents cannot observe others' effort. When the winner's identity is non-contractible, allocating credit based on effort at time of breakthrough also suffices to achieve efficiency; so the terminal effort profile, rather than the full history of effort, is a sufficient statistic. These findings suggest that simple mechanisms using minimal information are robust and effective in addressing inefficiencies in strategic experimentation.