The Adverse Consequences of Tournaments: Evidence from a Field Experiment

Arbeitspapier

We run a field experiment to investigate whether competing in rank-order tournaments with different prize spreads affects individual performance. Our experiment involved students from an Italian University who took an intermediate exam in which one part was awarded on the basis of their relative performance. Students were matched in pairs on the basis of their high school grades and each pair was randomly assigned to one of three different tournaments. Random assignment neutralizes selection effects and allows us to investigate if larger prize spreads increase individual effort. We do not find any positive effect of larger prizes on students' performance and in several specifications we do find a negative effect. Furthermore, we show that the effect of prize spreads on students' performance depends on their degree of risk-aversion: competing in tournaments with large spreads negatively affects the performance of risk-averse students, while it does not produce any effect on students who are more prone to take risks.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: IZA Discussion Papers ; No. 9854

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Compensation Packages; Payment Methods ; Wage Level and Structure; Wage Differentials ; Human Capital; Skills; Occupational Choice; Labor Productivity ; Criteria for Decision-Making under Risk and Uncertainty ; Asymmetric and Private Information; Mechanism Design ; Field Experiments
• Thema: rank-order tournaments ; incentives ; prize spread ; risk-aversion ; randomized experiment

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): De Paola, Maria ; Gioia, Francesca ; Scoppa, Vincenzo
• Ereignis: Veröffentlichung
• (wer): Institute for the Study of Labor (IZA)
• (wo): Bonn
• (wann): 2016

Weitere Informationen

• Handle: http://hdl.handle.net/10419/141613
• Letzte Aktualisierung: 10.03.2025, 11:41 MEZ