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- David C. Croson & Thomas A. Weber (2004): The Mushroom Treatment: Information Suppression and Misrepresentation in Organizations
The “mushroom treatment� ... We develop a model of this practice of information suppression and misrepresentation within organizations, wherein informed principals have an incentive to deliberately communicate degraded information (clipped “sales leads�) ... We find that the principal can generally increase expected revenues by strategically controlling the timing of the information dissemination, and that a further increase may be possible by deliberately degrading information quality in a manner verifiable for the agent. ... The benefits of manipulating information in terms of exercising control and resolving incentive problems within a firm renders deliberate (and possibly costly) obfuscation a natural part of an organization’s internal communication structure. The value of an information system within an organization, therefore, will not be monotone in its transmission accuracy; enforcedly accurate information systems which prevent such manipulation entirely may have negative val
RePEc:ecm:ausm04:113 Save to MyIDEAS