”You Scratch My Back, and (Maybe) I’ll Scratch Yours: Whistleblowing Games on Networks”

Speaker: Soheil Eshghi

Abstract: Innovation is risky business - what an organization gains in efficiency can be off-set by new ways of failing. Companies seek to limit their risk exposure by enforcing certain working norms with threats of punishment. However, draconian punishment policies can stifle innovation and are costly to enforce. One way for an organization to limit their exposure to risk while allowing innovation to thrive is to rely on internal whistleblowers, whose reports can be aggregated to provide a (hopefully accurate) estimate of risk exposure. Thus, in designing an organization’s whistleblowing and audit policies, it is important to understand the incentives of both workers and company management.

In this talk, I will present an analysis of sequential-game models of anonymous and semi-anonymous whistleblowing policies. In anonymous policies, workers can alert management to observed risky and/or unethical behavior without identifying the perpetrator. For the whistleblower, this is safer than the semi-anonymous case (where suspects are named), as it is more difficult for an outed party to identify them. On the other hand, relying on specific reports can lead to collusion between workers to hide unethical behavior. I will compare and contrast equilibrium outcomes among these two policy types, and will show how degree-heterogeneity in the worker network can lead to better organizational outcomes in the semi-anonymous case.

Speaker bio: Soheil Eshghi is a postdoctoral associate in the Electrical Engineering department at Yale University. His research interests are in applications of optimal control theory and game theory to networked systems. In particular, his work has focused on more efficient resource allocation in epidemics and advertising. He obtained his PhD degree in Electrical and Systems Engineering from the University of Pennsylvania in 2015 under the guidance of Prof. Saswati Sarkar. His doctoral work investigated the effects of heterogeneity on the control of epidemics. In the summer of 2014, he was a research intern at NEC Labs America in Cupertino, CA, and in 2015-16, he was a postdoctoral associate in the Electrical and Computer Engineering Department of Cornell University, Ithaca, NY. 

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