Avoiding Moral Hazards in Organizational Forecasting

We describe a new mechanism that induces accurate forecasts within an organization while reducing moral hazards and the stigma associated with negative opinions. It is based on the notion of identity escrow, whereby the identity of a forecaster is kept anonymous and only revealed when a number of his subordinates detect an attitude that is contrary to the interests of the organization. An analysis of the relative payoffs between forecasting and production shows that through the use of identity escrows one can adjust the size of the prediction group so as to ensure both production and accurate forecasts