Tournament Performance and ‘Agency’ Problems: An Empirical Investigation of ‘March Madness’
AbstractTournaments have long been used as a resource allocation device. Regardless of the margin of victory, a tournament's champion is typically rewarded far more handsomely than are its losers. For this reason, a tournament can generally be expected to elicit spectacular levels of performance from a group of competitors; performances in professional golf tournaments are an example. Surprisingly, the analysis in this paper indicates the existence of no significant relationship between the rewards and performances of participants in the NCAA basketball tournament. To explain this finding we allude to the classic principal-agent problem.
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Bibliographic InfoPaper provided by Ball State University, Department of Economics in its series Working Papers with number 199601.
Length: 14 pages
Date of creation: Jan 1996
Date of revision: Jan 1997
Publication status: Published in Journal of Economics and Finance 21 no. 1 (1997): 61-68.
NCAA Basketball Tournament; Principal-Agent Problem; Incentive Effects;
Other versions of this item:
- James McClure & Lee Spector, 1997. "Tournament performance and “Agency” problems: An empirical investigation of “March madness”," Journal of Economics and Finance, Springer, vol. 21(1), pages 61-68, March.
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