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Doing Your Best When Stakes Are High? Theory and Experimental Evidence

Author

Listed:
  • Houy, Nicolas

    (University of Lyon 2)

  • Nicolaï, Jean-Philippe

    (ETH Zurich)

  • Villeval, Marie Claire

    (CNRS, GATE)

Abstract

Achieving an ambitious goal frequently requires succeeding in a sequence of intermediary tasks, some being critical for the final outcome, and others not. Individuals are not always able to provide a level of effort sufficient to guarantee success in all the intermediary tasks. The ability to manage effort throughout the sequence of tasks is therefore critical. In this paper we propose a criterion that defines the importance of a task and that identifies how an individual should optimally allocate a limited stock of exhaustible efforts over tasks. We test this importance criterion in a laboratory experiment that reproduces the main features of a tennis match. We show that our importance criterion is able to predict the individuals' performance and it outperforms the Morris importance criterion that defines the importance of a point in terms of its impact on the probability to achieve the final outcome. We also find no evidence of choking under pressure and stress, as proxied by electrophysiological measures.

Suggested Citation

  • Houy, Nicolas & Nicolaï, Jean-Philippe & Villeval, Marie Claire, 2016. "Doing Your Best When Stakes Are High? Theory and Experimental Evidence," IZA Discussion Papers 9766, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp9766
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    References listed on IDEAS

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    1. Jose Apesteguia & Ignacio Palacios-Huerta, 2010. "Psychological Pressure in Competitive Environments: Evidence from a Randomized Natural Experiment," American Economic Review, American Economic Association, vol. 100(5), pages 2548-2564, December.
    2. González-Díaz, Julio & Gossner, Olivier & Rogers, Brian W., 2012. "Performing best when it matters most: Evidence from professional tennis," Journal of Economic Behavior & Organization, Elsevier, vol. 84(3), pages 767-781.
    3. Martin G. Kocher & Marc V. Lenz & Matthias Sutter, 2012. "Psychological Pressure in Competitive Environments: New Evidence from Randomized Natural Experiments," Management Science, INFORMS, vol. 58(8), pages 1585-1591, August.
    4. Dohmen, Thomas J., 2008. "Do professionals choke under pressure?," Journal of Economic Behavior & Organization, Elsevier, vol. 65(3-4), pages 636-653, March.
    5. Ben Greiner, 2004. "The Online Recruitment System ORSEE 2.0 - A Guide for the Organization of Experiments in Economics," Working Paper Series in Economics 10, University of Cologne, Department of Economics.
    6. Dan Ariely & Uri Gneezy & George Loewenstein & Nina Mazar, 2009. "Large Stakes and Big Mistakes," Review of Economic Studies, Oxford University Press, vol. 76(2), pages 451-469.
    7. repec:awi:wpaper:0593 is not listed on IDEAS
    8. Romain Gauriot & Lionel Page, 2019. "Does Success Breed Success? a Quasi-Experiment on Strategic Momentum in Dynamic Contests," The Economic Journal, Royal Economic Society, vol. 129(624), pages 3107-3136.
    9. Ben Greiner, 2004. "The Online Recruitment System ORSEE - A Guide for the Organization of Experiments in Economics," Papers on Strategic Interaction 2003-10, Max Planck Institute of Economics, Strategic Interaction Group.
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    Cited by:

    1. Charness, Gary & Gneezy, Uri & Henderson, Austin, 2018. "Experimental methods: Measuring effort in economics experiments," Journal of Economic Behavior & Organization, Elsevier, vol. 149(C), pages 74-87.

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    More about this item

    Keywords

    experiment; Morris-importance; Skin Conductance Responses; choking under pressure; critical ability;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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