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Cognitive performance in competitive environments: evidence from a natural experiment

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  • González-Díaz, Julio
  • Palacios-Huerta, Ignacio

Abstract

Competitive situations that involve cognitive performance are widespread in labor markets, schools, and organizations, including test taking, competition for promotion in firms, and others. This paper studies cognitive performance in a high-stakes competitive environment. The analysis takes advantage of a natural experiment that randomly allocates different emotional states across professional subjects competing in a cognitive task. The setting is a chess match where two players play an even number of chess games against each other alternating the color of the pieces. White pieces confer an advantage for winning a chess game and who starts the match with these pieces is randomly decided. The theoretical analysis shows that in this setting there is no rational reason why winning frequencies should be better than 50-50 in favor of the player drawing the white pieces in the first game. Yet, we find that observed frequencies are about 60-40. Differences in performance are also stronger when the competing subjects are more similar in cognitive skills. We conclude that the evidence is consistent with the hypothesis that psychological elements affect cognitive performance in the face of experience, competition, and high stakes.

Suggested Citation

  • González-Díaz, Julio & Palacios-Huerta, Ignacio, 2016. "Cognitive performance in competitive environments: evidence from a natural experiment," LSE Research Online Documents on Economics 67144, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:67144
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    7. Künn, Steffen & Seel, Christian & Zegners, Dainis, 2020. "Cognitive Performance in the Home Office - Evidence from Professional Chess," Research Memorandum 021, Maastricht University, Graduate School of Business and Economics (GSBE).
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    Keywords

    cognitive performance; competition; natural experiments;
    All these keywords.

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics

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