Competitive Familiarity: Learning to Coordinate by Competing

This paper develops and tests a simple theory of organizational learning, proposing that prior competitive interaction improves coordination amongst teammates. We test the theory using millions of quasi-experiments in the formation of high-level eSports teams. The results show that exogenously assigned teams of former competitors are highly effective—the returns to prior competitive interaction are at least three times the returns to prior collaborative interaction. The evidence suggests that teammates learn to coordinate by competing, a finding with implications for organizational design and the management of human capital.