Using Job Rotation to Extract Employee Information

This article provides an incentive-based explanation for the practice of job rotation. When agents privately learn about the productivity of tasks on which they work, job rotation can be an efficient means of eliciting their information. Each agent freely communicates his information since the switch in tasks guarantees his report will not subsequently be used against him; the report is used primarily in evaluating the new agent who moves into the task. Another benefit is that an agent rotated into a job holds less task-specific information and is thus easier to motivate. Job rotation also comes with a cost--agents must be compensated for the disutility of working on new tasks. We study this trade-off and identify conditions under which job rotation and specialization are each optimal. Copyright 2004, Oxford University Press.