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Consistency or Heroics: Skewness, Performance, and Earnings on the PGA TOUR


  • Stephen Shmanske



The structure of the payments in professional golf tournaments is heavily weighted to reward the top performers more handily. On the PGA TOUR, for example, the winner typically receives 18% of the purse, second place receives 10.8%, and so on down to 0.2% for 70th place. This payment structure brings up the possibility that the PGA TOUR is disproportionately rewarding one-time, exceptional performances rather than consistent steady play. To examine the extent of this effect, this paper correlates the 2002 earnings of the top 100 PGA TOUR professional golfers with their average performances, the variance around the averages, and the skewness of the individual distributions of their scores. Mean performance, variance, and skewness are all significantly related to earnings per tournament in the theoretically predicted directions. The research makes connections to and has implications for several topics in the sports economics literature including competitive balance and the hot-hand phenomenon. Additionally, it uncovers a heretofore unappreciated consequence concerning the relationships among the distributions of effort, performance, and remuneration in the tournaments compensation model. Copyright International Atlantic Economic Society 2007

Suggested Citation

  • Stephen Shmanske, 2007. "Consistency or Heroics: Skewness, Performance, and Earnings on the PGA TOUR," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 35(4), pages 463-471, December.
  • Handle: RePEc:kap:atlecj:v:35:y:2007:i:4:p:463-471
    DOI: 10.1007/s11293-007-9080-z

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    References listed on IDEAS

    1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-864, October.
    2. Andrew S. Zimbalist, 2002. "Competitive Balance in Sports Leagues: An Introduction," Journal of Sports Economics, , vol. 3(2), pages 111-121, May.
    3. Martin B. Schmidt & David J. Berri, 2001. "Competitive Balance and Attendance," Journal of Sports Economics, , vol. 2(2), pages 145-167, May.
    4. Ehrenberg, Ronald G & Bognanno, Michael L, 1990. "Do Tournaments Have Incentive Effects?," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1307-1324, December.
    5. Szymanski, Stefan, 2001. "Income Inequality, Competitive Balance and the Attractiveness of Team Sports: Some Evidence and a Natural Experiment from English Soccer," Economic Journal, Royal Economic Society, vol. 111(469), pages 69-84, February.
    6. Gerald W. Scully, 2002. "The Distribution of Performance and Earnings in a Prize Economy," Journal of Sports Economics, , vol. 3(3), pages 235-245, August.
    7. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-858, December.
    8. Brad R. Humphreys, 2002. "Alternative Measures of Competitive Balance in Sports Leagues," Journal of Sports Economics, , vol. 3(2), pages 133-148, May.
    9. Patrick James Rishe, 2001. "Differing Rates of Return to Performance," Journal of Sports Economics, , vol. 2(3), pages 285-296, August.
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    Cited by:

    1. Ilhyeok Park & Young Hoon Lee, 2012. "Efficiency Comparison of International Golfers in the LPGA," Journal of Sports Economics, , vol. 13(4), pages 378-392, August.
    2. Seung Chan Ahn & Young Hoon Lee, 2014. "Beauty And Productivity: The Case Of The Ladies Professional Golf Association," Contemporary Economic Policy, Western Economic Association International, vol. 32(1), pages 155-168, January.

    More about this item


    Tournaments compensation model; Effort and performance; Economics of golf; Hot-hand phenomenon; Competitive balance; Skewness of performance distribution; J31; L83; C81;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access


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