Biased Contests and Moral Hazard: Implications for Career Profiles
AbstractWe study the design of a sequence of two contests between a pair of identical risk averse employees whose effort choices are private information. It is optimal for the organization to "bias" the second contest in favor of the early winner--the reduction in second-period incentives is outweighed by the increase in first-period incentives. Thus, even though first-period success reflects only transitory shocks and not ability, it is efficient to structure the contests so these shocks have persistent effects on employees' careers.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by ENSAE in its journal Annals of Economics and Statistics.
Volume (Year): (1992)
Issue (Month): 25-26 ()
Other versions of this item:
- Meyer, Margaret A, 1992. "Biased Contests and Moral Hazard: Implications for Career Profiles," CEPR Discussion Papers 637, C.E.P.R. Discussion Papers.
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Junichiro Ishida, 2006.
"Dynamically Sabotage-Proof Tournaments,"
OSIPP Discussion Paper
06E001, Osaka School of International Public Policy, Osaka University.
- Volker Meier, 2001.
"Setting Incentives: Temporary Performance Premiums Versus Promotion Tournaments,"
CESifo Working Paper Series
432, CESifo Group Munich.
- Volker Meier, 2004. "Setting Incentives: Temporary Performance Premiums versus Promotion Tournaments," LABOUR, CEIS, vol. 18(4), pages 661-674, December.
- Sjögren Lindquist, Gabriella, 2006.
"Tournaments and Unfair Treatment,"
Working Paper Series
8/2006, Swedish Institute for Social Research.
- Kiyotaki, Fumi, 2004. "The effects of a consolation match on the promotion tournament," Journal of the Japanese and International Economies, Elsevier, vol. 18(2), pages 264-281, June.
- Francesco Caselli & Thomas E. Cunningham & Massimo Morelli & Inés Moreno de Barreda, 2012.
"Signalling, Incumbency Advantage, and Optimal Reelection Thresholds,"
NBER Working Papers
17833, National Bureau of Economic Research, Inc.
- Caselli, Francesco & Cunningham, Tom & Morelli, Massimo & Moreno de Barreda, Inés, 2012. "Signalling, Incumbency Advantage, and Optimal Reelection Thresholds," CEPR Discussion Papers 8832, C.E.P.R. Discussion Papers.
- Münster, Johannes, 2008. "Repeated contests with asymmetric information," Discussion Papers, Research Unit: Market Processes and Governance SP II 2008-08, Social Science Research Center Berlin (WZB).
- Jed DeVaro & Michael Waldman, 2012.
"The Signaling Role of Promotions: Further Theory and Empirical Evidence,"
Journal of Labor Economics,
University of Chicago Press, vol. 30(1), pages 91 - 147.
- DeVaro, Jed & Waldman, Michael, 2006. "The signaling role of promotions: Further theory and empirical evidence," MPRA Paper 1550, University Library of Munich, Germany.
- DeVaro, Jed, 2011. "Using "opposing responses" and relative performance to distinguish empirically among alternative models of promotions," MPRA Paper 35175, University Library of Munich, Germany.
- Ian Ayres & Colin Rowat & Nasser Zakariya, 2006.
"Optimal two stage committee voting rules,"
04-23r, Department of Economics, University of Birmingham.
- Ian Ayres & Colin Rowat & Nasser Zakariya, 2007. "Optimal Two Stage Committee Voting Rules," Discussion Papers 04-23RR, Department of Economics, University of Birmingham.
- Ian Ayres & Colin Rowat & Nasser Zakariya, 2004. "Optimal two stage committee voting rules," Game Theory and Information 0412006, EconWPA.
- Nicolas Carayol, 2003. "The incentive properties of the Matthew Effect in the academic competition," Working Papers of BETA 2003-11, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
- Francesco Caselli & Tom Cunningham & Massimo Morelli & Inés Moreno de Barreda, 2012. "Signalling, Incumbency Advantage, and Optimal Reelection Rules," CEP Discussion Papers dp1122, Centre for Economic Performance, LSE.
- Miklós-Thal, Jeanine & Ullrich, Hannes, 2009. "Nomination contests: theory and empirical evidence from professional soccer," ZEW Discussion Papers 09-027, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Waldman, Michael, 2007. "Theory and evidence in internal labor markets," MPRA Paper 5113, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Robert Gary-Bobo).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.