Testing the incentive effects in tournaments with a superstar
AbstractThis paper studies the effects of the levels and the structure of prizes on the efforts of agents with heterogeneous ability in a tournament model. In particular, we examine how the presence of a highly able agent affects the effort levels of other agents as well as the effects of the total and the marginal prizes. Using panel data from the Japan Golf Tour, we estimate the effects of the presence of a superstar, and the size of the total and marginal prizes on the scores of professional golfers. We find that the presence of a superstar adversely affects the scores of the other players; that the larger the size of the total prize, the better are the scores; and that the larger the marginal prizes that players face at the end of the third round, the better the scores they achieve in the final round.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of the Japanese and International Economies.
Volume (Year): 26 (2012)
Issue (Month): 3 ()
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Web page: http://www.elsevier.com/locate/inca/622903
Tournament model; Incentives; Prize allocation; Golf;
Find related papers by JEL classification:
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
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