ECOS 2201 Economics of Competition and Strategy
Suraj Prasad
Semester 2, 2021
Assignment – Motivating Creativity in Organizations
1 Details
The main objective of this assignment is to get you to apply concepts learnt in the
class to real world problems. In terms of allocating time, you should set aside about
2 hours a week to work on the assignment. The assignment (typed with 11 point font
and double spacing) has to be submitted on Canvas through Turnitin by midnight
12th of November, 2021 (more details on the link and how to submit the assignment
will be provided closer to the date).
2 Topic
For this assignment, I want you to consider a job where “creativity” plays a funda-
mental role. For example, creativity is a crucial input in most jobs that require some
form of innovation. The purpose of this assignment is to think about the challenges
of motivating creativity in an organization.
1. Select a job where creativity (as you choose to define it) plays a central role.
Briefly describe why creativity is important in this job.
2. Specify an incentive conflict (see lectures 1 to 5 for what I mean by incentive
conflict) related to creativity that arises on the job. Set up a very simple model
of this incentive conflict. For this you will need to think of why the incentive
conflict arises and the tools that can be used (e.g. monetary incentives or other
instruments that you think play an important role) to address it. You do not
need to solve your model.
By “set up a model”, I want you to highlight the main features of your model.
This can be done with a few equations/inequalities. Or you could even describe
these central features verbally. It just needs to be clear and concise.
3. What is the central tradeoff in your model?
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4. What implications and insights does your model generate? For example, if you
were to advise the CEO on designing incentives for creativity, what would your
advice be?
You may find the following article useful to begin your assignment: Creation
Myth by Malcolm Gladwell in the New Yorker. I found it quite interesting. You can
access this article on the library website at
https://sydney.primo.exlibrisgroup.com/permalink/61USYD_INST/2rsddf/
cdi_gale_lrcgauss_A256481380
You are not required to draw on this article though. It’s just to help you get
started.
3 Length
The assignment should be less than 3 pages (including references), double spaced,
11 point font.
4 Grading
The assignment counts for 15 percent of your overall grade in this unit. I will use
three criteria for the grading.
• How “creative” your assignment is – for instance, in highlighting a novel in-
centive problem and suggesting a way to fix it.
• How logical your argument is and the insights that your model can deliver.
You want your model to strike a balance between including (the most) relevant
details and being concise. This can be difficult.
• The clarity of your writing and arguments. Using a simple graph to capture
some of your main ideas could help with this.
5 References
Make sure that you reference your work if you draw on other sources.
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