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In this paper, we explore a natural experiment of organizational change from decentralization to centralization in a leading Chinese newspaper. Using a di¤erences-in-di¤erences approach, we nd that centralization on average increases the journalistsperformance, sheding light on the dark sides of decentralization. Contributions of this positive effect mainly comes from those journalists who are potentially associated with large private bene t and those who are victims of influence activities under decentralization. Our ndings are consistent with recent economic theories of organization under a multi-tasking framework. The results highlight the importance of heterogeneity in organizational design.
UC Berkeley on May 6-7, 2011 Link to Book