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Competition and Well-Being

Author Info

  • Brandts Jordi
  • Riedl Arno
  • Winden Frans van

    (METEOR)

Abstract

This paper experimentally studies the effects of competition in an environment where people’s actions can not be contractually fixed. We find that, in comparison with no competition, the presence of competition does neither increase efficiency nor does it yield any gains in earning for the short side of the exchange relation. Moreover, competition has a clearly negative impact on the disposition towards others and on the experienced well-being of those on the long side. Since subjective well-being improves only for those on the short side competition contributes to larger inequalities in experienced well-being. All in all competition does not show up as a positive force in our environment.

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Paper provided by Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR) in its series Research Memorandum with number 033.

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Date of creation: 2005
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Handle: RePEc:unm:umamet:2005033
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Keywords: microeconomics ;

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Find related papers by JEL classification:
  • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
  • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
  • D30 - Microeconomics - - Distribution - - - General
  • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
  • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General

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Cited by:

  1. Christiane Schwieren & Doris Weichselbaumer, 2008. "Does competition enhance performance or cheating? A laboratory experiment," NRN working papers 2008-05, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  2. Brian Roe & Steven Y. Wu, 2005. "Social Preferences and Relational Contracting Performance: An Experimental Investigation," Microeconomics 0509006, EconWPA.
  3. Fischer, Justina A.V., 2008. "Is competition good for trust? Cross-country evidence using micro-data," Economics Letters, Elsevier, vol. 100(1), pages 56-59, July.
  4. Rode, Julian, 2010. "Truth and trust in communication: Experiments on the effect of a competitive context," Games and Economic Behavior, Elsevier, vol. 68(1), pages 325-338, January.
  5. Rode, Julian, 2007. "Truth and Trust in Communication: An Experimental Study of Behavior under Asymmetric Information," Ratio Working Papers 111, The Ratio Institute.
  6. Roe, Brian E. & Wu, Steven Y., 2009. "Do the Selfish Mimic Cooperators? Experimental Evidence from Finitely-Repeated Labor Markets," IZA Discussion Papers 4084, Institute for the Study of Labor (IZA).
  7. Canegallo, Claudia & Ortona, Guido & Ottone, Stefania & Ponzano, Ferruccio & Scacciati, Francesco, 2008. "Competition versus cooperation: Some experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(1), pages 18-30, February.
  8. Arno Riedl, 2009. "Behavioral and Experimental Economics Can Inform Public Policy: Some Thoughts," CESifo Working Paper Series 2902, CESifo Group Munich.

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