Designing Multiperson Tournaments with Asymmetric Contestants: An Experimental Study

Designing Multiperson Tournaments with Asymmetric Contestants: An Experimental Study

0.00 Avg rating0 Votes
Article ID: iaor20115171
Volume: 57
Issue: 5
Start Page Number: 864
End Page Number: 883
Publication Date: May 2011
Journal: Management Science
Authors: , ,
Keywords: tournament games
Abstract:

Is the right amount of effort exerted in multiperson tournaments where contestants have two different levels of initial endowments (termed ‘favorites’ and ‘underdogs’)? We develop theoretical predictions for the level of effort and the effect of varying the prize structure. We test these predictions for three‐person tournaments using an economic experiment in a social environment where contest outcomes are publicly announced. We find that both favorites and underdogs overexert effort relative to the theoretical point predictions. Moreover, in the treatment with two favorites and one underdog, favorites increase their effort when the number of prizes is increased from one to two, contrary to the theory prediction. We show that a generalized model that allows for psychological losses from losing for favorites and psychological gains from winning for underdogs because of social comparisons tracks the experimental results better than the standard theoretical model.

Reviews

Required fields are marked *. Your email address will not be published.