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On the Role of Group Size in Tournaments: Theory and Evidence from Laboratory and Field Experiments

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  • John A. List

    (University of Chicago, Chicago, Illinois 60637; National Bureau of Economic Research, Cambridge, Massachusetts 02138;)

  • Daan van Soest

    (Tilburg University, 5037 AB Tilburg, Netherlands;)

  • Jan Stoop

    (Erasmus University, 3000 DR Rotterdam, Netherlands;)

  • Haiwen Zhou

    (Old Dominion University, Norfolk, Virginia 23529)

Abstract

We explore how individual equilibrium effort in tournaments varies with the number of contestants. The probability of winning a tournament depends on both effort and luck, and we show that the distribution of the luck component is critical in determining individual equilibrium effort. Our theory predicts that equilibrium effort is an increasing (decreasing) function of the number of contestants if there is considerable (little) mass on favorable draws. We test our theory using both laboratory and field experiments, and find substantial support for our theory in both settings.

Suggested Citation

  • John A. List & Daan van Soest & Jan Stoop & Haiwen Zhou, 2020. "On the Role of Group Size in Tournaments: Theory and Evidence from Laboratory and Field Experiments," Management Science, INFORMS, vol. 66(10), pages 4359-4377, October.
    • Handle: RePEc:inm:ormnsc:v:66:y:2020:i:10:p:4359-4377
    DOI: 10.1287/mnsc.2019.3441
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    References listed on IDEAS

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    Cited by:

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    3. Yan Chen & Peter Cramton & John A. List & Axel Ockenfels, 2021. "Market Design, Human Behavior, and Management," Management Science, INFORMS, vol. 67(9), pages 5317-5348, September.
    4. Gall, Thomas & Hu, Xiaocheng & Vlassopoulos, Michael, 2023. "Incentivizing Team Leaders: A Firm-Level Experiment on Subjective Performance Evaluation of Leadership Skills," IZA Discussion Papers 16123, Institute of Labor Economics (IZA).
    5. Timothy Mathews & Soiliou Daw Namoro & James W. Boudreau, 2023. "The Impact of Organizer Market Structure on Participant Entry Behavior in a Multi-Tournament Environment," Games, MDPI, vol. 14(1), pages 1-21, January.
    6. Yuan Jin & Ho Cheung Brian Lee & Sulin Ba & Jan Stallaert, 2021. "Winning by Learning? Effect of Knowledge Sharing in Crowdsourcing Contests," Information Systems Research, INFORMS, vol. 32(3), pages 836-859, September.
    7. Laurence Ales & Soo‐Haeng Cho & Ersin Körpeoğlu, 2021. "Innovation Tournaments with Multiple Contributors," Production and Operations Management, Production and Operations Management Society, vol. 30(6), pages 1772-1784, June.

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