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Rankings, Random Successes, and Individual Performance

  • Legge, Stefan

    ()

  • Schmid, Lukas

    ()

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    Rankings have become increasingly important over the past decades and impose a sharp distinction between success and failure. In this paper we examine the effects of ranking positions and great successes on individual performance by using a rich set of data on World Cup alpine ski races for the period of 1992-2013. We apply a regression discontinuity design and exploit close races as a source of randomized treatment. Our results suggest substantial short-run effects of randomly assigned podium finishes on performance, especially for racers in the middle of the skill distribution. However, the effects are short-lived and mostly driven by individuals who miss prestigious ranks by a tiny margin. We identify media attention as the key channel for performance effects and provide empirical evidence for an increasing media bias in favor of top-ranked competitors in the last two decades. These findings highlight a serious drawback of rankings.

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    File URL: http://www1.vwa.unisg.ch/RePEc/usg/econwp/EWP-1340.pdf
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    Paper provided by University of St. Gallen, School of Economics and Political Science in its series Economics Working Paper Series with number 1340.

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    Length: 52 pages
    Date of creation: Dec 2013
    Date of revision:
    Handle: RePEc:usg:econwp:2013:40
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