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Competition and Well-Being

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  • Jordi Brandts
  • Arno Riedl
  • Frans van Winden

Abstract

We study the effects of competition in a context in which people's actions can not be contractually fixed. We find that in such an environment the very presence of competition does neither increase efficiency nor does it yield any payoff gains for the short side of the market. We also find that competition has a strong negative impact on social well-being, the disposition towards others, and individually experienced well-being, the emotional state, of those on the long side of the market. We conjecture that this limits the possibilities of satisfactory interaction in the future and, hence, has negative implications for efficiency in the longer-run.

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Bibliographic Info

Paper provided by Barcelona Graduate School of Economics in its series Working Papers with number 120.

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Date of creation: Apr 2004
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Handle: RePEc:bge:wpaper:120

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Keywords: Competition; happiness; well-being; laboratory experiment; emotions; market interaction;

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Citations

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Cited by:
  1. Brian Roe & Steven Y. Wu, 2005. "Social Preferences and Relational Contracting Performance: An Experimental Investigation," Microeconomics 0509006, EconWPA.
  2. Schwieren, Christiane & Weichselbaumer, Doris, 2010. "Does competition enhance performance or cheating? A laboratory experiment," Journal of Economic Psychology, Elsevier, vol. 31(3), pages 241-253, June.
  3. Fischer, Justina A.V., 2008. "Is competition good for trust? Cross-country evidence using micro-data," Economics Letters, Elsevier, vol. 100(1), pages 56-59, July.
  4. Arno Riedl, 2009. "Behavioral and Experimental Economics Can Inform Public Policy: Some Thoughts," CESifo Working Paper Series 2902, CESifo Group Munich.
  5. Ridderinkhof, Richard & Stallen, Mirre & van Winden, Frans A.A.M., 2008. "On the Nature, Modeling, and Neural Bases of Social Ties," CEPR Discussion Papers 6950, C.E.P.R. Discussion Papers.
  6. Canegallo, Claudia & Ortona, Guido & Ottone, Stefania & Ponzano, Ferruccio & Scacciati, Francesco, 2008. "Competition versus cooperation: Some experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(1), pages 18-30, February.
  7. Rode, Julian, 2010. "Truth and trust in communication: Experiments on the effect of a competitive context," Games and Economic Behavior, Elsevier, vol. 68(1), pages 325-338, January.
  8. Roe, Brian E. & Wu, Steven Y., 2009. "Do the Selfish Mimic Cooperators? Experimental Evidence from Finitely-Repeated Labor Markets," IZA Discussion Papers 4084, Institute for the Study of Labor (IZA).
  9. Rode, Julian, 2007. "Truth and Trust in Communication: An Experimental Study of Behavior under Asymmetric Information," Ratio Working Papers 111, The Ratio Institute.

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