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Career Prospects and Effort Incentives: Evidence from Professional Soccer

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  • Jeanine Miklós-Thal

    (Simon Business School, University of Rochester, Rochester, New York 14627)

  • Hannes Ullrich

    (Department of Firms and Markets, DIW Berlin, 10108 Berlin, Germany; and Department of Business Administration, University of Zurich, CH-8032 Zurich, Switzerland)

Abstract

It is difficult to test the prediction that future career prospects create implicit effort incentives because researchers cannot randomly “assign” career prospects to economic agents. To overcome this challenge, we use data from professional soccer, where employees of the same club face different external career opportunities depending on their nationality. We test whether the career prospect of being selected to a Euro Cup national team affects players’ pre-cup performances, using nationals of countries that did not participate in the Euro Cup as a control group. We find that the Euro Cup career prospect has positive effects on the performances of players with intermediate chances of being selected to their national team, but negative effects on the performances of players whose selection is very probable. Our findings have implications for the incentive effects of within-firm promotions and of external career opportunities. This paper was accepted by John List, behavioral economics.

Suggested Citation

  • Jeanine Miklós-Thal & Hannes Ullrich, 2016. "Career Prospects and Effort Incentives: Evidence from Professional Soccer," Management Science, INFORMS, vol. 62(6), pages 1645-1667, June.
  • Handle: RePEc:inm:ormnsc:v:62:y:2016:i:6:p:1645-1667
    DOI: 10.1287/mnsc.2015.2211
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    Cited by:

    1. Pablo Casas‐Arce & Santhi Hejeebu, 2012. "Job Design in the Presence of Career Concerns," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 21(4), pages 1083-1109, December.
    2. Lackner, Mario & Stracke, Rudi & Sunde, Uwe & Winter-Ebmer, Rudolf, 2020. "Are competitors forward looking in strategic interactions? Field evidence from multistage tournaments," Journal of Economic Behavior & Organization, Elsevier, vol. 179(C), pages 544-565.
    3. Benjamin Balsmeier & Bernd Frick & Michael Hickfang, 2019. "The impact of skilled immigrants on their local teammates’ performance," Applied Economics Letters, Taylor & Francis Journals, vol. 26(2), pages 97-103, January.
    4. Rosa Ferrer Zarzuela, 2015. "The effect of lawyers' career concerns on litigation," Economics Working Papers 1496, Department of Economics and Business, Universitat Pompeu Fabra, revised Oct 2016.
    5. Lei Xu & Tingting Nian & Luis Cabral, 2018. "What Makes Geeks Tick? A Study of Stack Overflow Careers," Working Papers 18-04, New York University, Leonard N. Stern School of Business, Department of Economics.
    6. Besters, Lucas, 2018. "Economics of professional football," Other publications TiSEM d9e6b9b7-a17b-4665-9cca-1, Tilburg University, School of Economics and Management.
    7. David Butler & Robert Butler & Robert Simmons, 2022. "Contracts, pay and performance in the sport of kings: Evidence from horse racing," British Journal of Industrial Relations, London School of Economics, vol. 60(1), pages 152-175, March.
    8. Hannes Ullrich, 2014. "Leistungsanreize in Unternehmen," DIW Roundup: Politik im Fokus 32, DIW Berlin, German Institute for Economic Research.
    9. Ambroise Descamps & Changxia Ke & Lionel Page, 2022. "How success breeds success," Quantitative Economics, Econometric Society, vol. 13(1), pages 355-385, January.
    10. Grossmann, Martin & Hottiger, Dieter, 2020. "Liquidity constraints and the formation of unbalanced contests," International Journal of Industrial Organization, Elsevier, vol. 73(C).
    11. Mario Lackner & Hendrik Sonnabend, 2023. "Presenteeism when employers are under pressure: evidence from a high‐stakes environment," Economica, London School of Economics and Political Science, vol. 90(358), pages 477-507, April.
    12. Xu, Shuling & Hall, Nicholas G., 2021. "Fatigue, personnel scheduling and operations: Review and research opportunities," European Journal of Operational Research, Elsevier, vol. 295(3), pages 807-822.
    13. Erina Ytsma, 2022. "Effort and Selection Effects of Performance Pay in Knowledge Creation," CESifo Working Paper Series 10153, CESifo.
    14. Lei Xu & Tingting Nian & Luís Cabral, 2020. "What Makes Geeks Tick? A Study of Stack Overflow Careers," Management Science, INFORMS, vol. 66(2), pages 587-604, February.
    15. Jie Gong & Ang Sun & Zhichao Wei, 2018. "Choosing the Pond: On-the-Job Experience and Long-Run Career Outcomes," Management Science, INFORMS, vol. 64(2), pages 860-872, February.

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    More about this item

    Keywords

    incentives; effort; career concerns; reputation; contests; tournaments; promotions;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • L29 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Other
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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