Advanced Search
MyIDEAS: Login to save this article or follow this journal

Self-Selection And The Efficiency Of Tournaments

Contents:

Author Info

  • TOR ERIKSSON
  • SABRINA TEYSSIER
  • MARIE-CLAIRE VILLEVAL

Abstract

"The literature has shown that the overall efficiency of exogenously imposed tournaments is reduced by a high variance in performance. This article reports results from an experiment analyzing whether allowing subjects to self-select into different payment schemes is reducing the variability of performance in tournaments. We show that when the subjects choose to enter a tournament instead of a piece-rate payment scheme, the average effort is higher and the between-subject variance is substantially lower than when the same payment scheme is imposed. Mainly based on risk aversion, sorting is efficiency enhancing since it increases the homogeneity of the contestants". ("JEL "M52, J33, J31, C81, C91) Copyright (c) 2007 Western Economic Association International.

Download Info

If 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.
File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1465-7295.2007.00094.x
File Function: link to full text
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Western Economic Association International in its journal Economic Inquiry.

Volume (Year): 47 (2009)
Issue (Month): 3 (07)
Pages: 530-548

as in new window
Handle: RePEc:bla:ecinqu:v:47:y:2009:i:3:p:530-548

Contact details of provider:
Postal: 18830 Brookhurst Street, Suite 304, Fountain Valley, CA 92708 USA
Phone: 714-965-8800
Fax: 714-965-8829
Email:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0095-2583
More information through EDIRC

Order Information:
Web: http://www.blackwellpublishing.com/subs.asp?ref=0095-2583

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Bull, Clive & Schotter, Andrew & Weigelt, Keith, 1985. "Tournaments and Piece Rates: An Experimental Study," Working Papers, C.V. Starr Center for Applied Economics, New York University 85-21, C.V. Starr Center for Applied Economics, New York University.
  2. Lise Vesterlund & Muriel Niederle, 2004. "Do Women shy away from Competition?," Econometric Society 2004 North American Summer Meetings, Econometric Society 652, Econometric Society.
  3. Marie-Claire Villeval & Tor Eriksson, 2004. "Other-Regarding Preferences and Performance Pay – An Experiment on Incentives and Sorting," Working Papers, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure 0408, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
  4. Frans van Dijk & Joep Sonnemans & Frans van Winden, 1998. "Incentive Systems in a Real Effort Experiment," Tinbergen Institute Discussion Papers 98-023/1, Tinbergen Institute.
  5. Ehrenberg, Ronald G & Bognanno, Michael L, 1990. "Do Tournaments Have Incentive Effects?," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 98(6), pages 1307-24, December.
  6. Jerry R. Green & Nancy L. Stokey, 1982. "A Comparison of Tournaments and Contracts," NBER Working Papers 0840, National Bureau of Economic Research, Inc.
  7. O'Keeffe, Mary & Viscusi, W Kip & Zeckhauser, Richard J, 1984. "Economic Contests: Comparative Reward Schemes," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 2(1), pages 27-56, January.
  8. Harbring, Christine & Irlenbusch, Bernd, 2003. "An experimental study on tournament design," Labour Economics, Elsevier, Elsevier, vol. 10(4), pages 443-464, August.
  9. Nalbantian, Haig R & Schotter, Andrew, 1997. "Productivity under Group Incentives: An Experimental Study," American Economic Review, American Economic Association, American Economic Association, vol. 87(3), pages 314-41, June.
  10. Edward P. Lazear, 2000. "Performance Pay and Productivity," American Economic Review, American Economic Association, American Economic Association, vol. 90(5), pages 1346-1361, December.
  11. Schotter, Andrew & Weigelt, Keith, 1992. "Asymmetric Tournaments, Equal Opportunity Laws, and Affirmative Action: Some Experimental Results," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 107(2), pages 511-39, May.
  12. Bognanno, Michael L, 2001. "Corporate Tournaments," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 19(2), pages 290-315, April.
  13. Bohnet, Iris & Kübler, Dorothea, 2000. "Compensating the cooperators: Is sorting in the prisoner's dilemma possible?," SFB 373 Discussion Papers 2001,2, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
  14. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, American Economic Association, vol. 37(1), pages 7-63, March.
  15. Richard L. Fullerton & R. Preston McAfee, 1999. "Auctioning Entry into Tournaments," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 107(3), pages 573-605, June.
  16. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2005. "Social Preferences and the Response to Incentives: Evidence from Personnel Data," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 120(3), pages 917-962, August.
  17. Hvide, Hans K. & Kristiansen, Eirik G., 2003. "Risk taking in selection contests," Games and Economic Behavior, Elsevier, Elsevier, vol. 42(1), pages 172-179, January.
  18. Edward Lazear & Ulrike Malmendier & Roberto Weber, 2006. "Sorting, Prices, and Social Preferences," NBER Working Papers 12041, National Bureau of Economic Research, Inc.
  19. Datta Gupta, Nabanita & Poulsen, Anders & Villeval, Marie Claire, 2005. "Male and Female Competitive Behavior: Experimental Evidence," IZA Discussion Papers 1833, Institute for the Study of Labor (IZA).
  20. Charles Bellemare & Bruce S. Shearer, 2006. "Sorting, Incentives and Risk Preferences: Evidence from a Field Experiment," Cahiers de recherche, CIRPEE 0631, CIRPEE.
  21. Nabanita Datta Gupta & Anders Poulsen & Marie-Claire Villeval, 2005. "Male and Female Competitive Behavior: Experimental," Post-Print, HAL halshs-00175039, HAL.
  22. Lazear, Edward P, 1989. "Pay Equality and Industrial Politics," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 97(3), pages 561-80, June.
  23. Christine Harbring & Bernd Irlenbusch, 2005. "Incentives in Tournaments with Endogenous Prize Selection," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, Mohr Siebeck, Tübingen, vol. 161(4), pages 636-, December.
  24. Edward P. Lazear & Sherwin Rosen, 1979. "Rank-Order Tournaments as Optimum Labor Contracts," NBER Working Papers 0401, National Bureau of Economic Research, Inc.
  25. Knoeber, Charles R & Thurman, Walter N, 1994. "Testing the Theory of Tournaments: An Empirical Analysis of Broiler Production," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 12(2), pages 155-79, April.
  26. repec:wop:humbsf:2001-2 is not listed on IDEAS
  27. Main, Brian G M & O'Reilly, Charles A, III & Wade, James, 1993. "Top Executive Pay: Tournament or Teamwork?," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 11(4), pages 606-28, October.
  28. Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, American Economic Association, vol. 92(5), pages 1644-1655, December.
  29. Eriksson, Tor, 1999. "Executive Compensation and Tournament Theory: Empirical Tests on Danish Data," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 17(2), pages 262-80, April.
  30. Vandegrift, Donald & Brown, Paul, 2003. "Task difficulty, incentive effects, and the selection of high-variance strategies: an experimental examination of tournament behavior," Labour Economics, Elsevier, Elsevier, vol. 10(4), pages 481-497, August.
  31. Alannah Orrison & Andrew Schotter & Keith Weigelt, 2004. "Multiperson Tournaments: An Experimental Examination," Management Science, INFORMS, INFORMS, vol. 50(2), pages 268-279, February.
  32. Edward P. Lazear & Ulrike Malmendier & Roberto A. Weber, 2012. "Sorting in Experiments with Application to Social Preferences," American Economic Journal: Applied Economics, American Economic Association, American Economic Association, vol. 4(1), pages 136-63, January.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:bla:ecinqu:v:47:y:2009:i:3:p:530-548. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F. Baum).

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.