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Monitoring in Tournaments

Author

Listed:
  • Jaesoo Kim

    (Department of Economics, Indiana University Purdue University Indianapolis (IUPUI))

  • Jongwoo Park

    (Bank of Korea)

Abstract

We show that less monitoring can increase effort and alleviate the moral hazard problem in tournaments. We also find a unique optimal level of monitoring based on contestants' abilities. As the difference between their abilities gets larger, the contest designer should monitor less.

Suggested Citation

  • Jaesoo Kim & Jongwoo Park, 2014. "Monitoring in Tournaments," Economics Bulletin, AccessEcon, vol. 34(3), pages 1431-1437.
    • Handle: RePEc:ebl:ecbull:eb-13-00272
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2014/Volume34/EB-14-V34-I3-P131.pdf
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    References listed on IDEAS

    as
    1. Che, Yeon-Koo & Gale, Ian L, 1998. "Caps on Political Lobbying," American Economic Review, American Economic Association, vol. 88(3), pages 643-651, June.
    2. Green, Jerry R & Stokey, Nancy L, 1983. "A Comparison of Tournaments and Contracts," Journal of Political Economy, University of Chicago Press, vol. 91(3), pages 349-364, June.
    3. Kyung Hwan Baik, 2004. "Two-Player Asymmetric Contests with Ratio-Form Contest Success Functions," Economic Inquiry, Western Economic Association International, vol. 42(4), pages 679-689, October.
    4. O'Keeffe, Mary & Viscusi, W Kip & Zeckhauser, Richard J, 1984. "Economic Contests: Comparative Reward Schemes," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 27-56, January.
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    More about this item

    Keywords

    tournament; moral hazard; monitoring;
    All these keywords.

    JEL classification:

    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

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