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Competition and Well-Being

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  • Jordi Brandts

    (Institut d'An�lisi Econ�mica (CSIC), Barcelona)

  • Arno Riedl

    ()
    (CREED, Faculty of Economics and Econometrics, Universiteit van Amsterdam)

  • Frans van Winden

    ()
    (CREED, Faculty of Economics and Econometrics, Universiteit van Amsterdam)

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 Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 04-041/1.

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Date of creation: 19 Apr 2004
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Handle: RePEc:dgr:uvatin:20040041

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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. 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, Elsevier, vol. 37(1), pages 18-30, February.
  2. Rode, Julian, 2007. "Truth and Trust in Communication: An Experimental Study of Behavior under Asymmetric Information," Ratio Working Papers, The Ratio Institute 111, The Ratio Institute.
  3. Schwieren, Christiane & Weichselbaumer, Doris, 2010. "Does competition enhance performance or cheating? A laboratory experiment," Journal of Economic Psychology, Elsevier, Elsevier, vol. 31(3), pages 241-253, June.
  4. Frans van Winden & Mirre Stallen & K. Richard Ridderinkhof, 2008. "On the Nature, Modeling, and Neural Bases of Social Ties," Tinbergen Institute Discussion Papers, Tinbergen Institute 08-063/1, Tinbergen Institute.
  5. Brian Roe & Steven Y. Wu, 2005. "Social Preferences and Relational Contracting Performance: An Experimental Investigation," Microeconomics, EconWPA 0509006, EconWPA.
  6. Rode, Julian, 2010. "Truth and trust in communication: Experiments on the effect of a competitive context," Games and Economic Behavior, Elsevier, Elsevier, vol. 68(1), pages 325-338, January.
  7. Fischer, Justina A.V., 2008. "Is competition good for trust? Cross-country evidence using micro-data," Economics Letters, Elsevier, Elsevier, vol. 100(1), pages 56-59, July.
  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. Arno Riedl, 2009. "Behavioral and Experimental Economics Can Inform Public Policy: Some Thoughts," CESifo Working Paper Series 2902, CESifo Group Munich.

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