Management Science Vol. 66 No. 10 2020

On the Role of Group Size in Tournaments: Theory and Evidence from Laboratory and Field Experiments

John A. List^1,2; Daan van Soest³; Jan Stoop⁴; Haiwen Zhou⁵

¹ University of Chicago, Chicago, Illinois 60637; · ² National Bureau of Economic Research, Cambridge, Massachusetts 02138; · ³ Tilburg University, 5037 AB Tilburg, Netherlands · ⁴ Erasmus University, 3000 DR Rotterdam, Netherlands; · ⁵ Old Dominion University, Norfolk, Virginia 23529

Abstract

We explore how individual equilibrium effort in tournaments varies with the number of contestants. The probability of winning a tournament depends on both effort and luck, and we show that the distribution of the luck component is critical in determining individual equilibrium effort. Our theory predicts that equilibrium effort is an increasing (decreasing) function of the number of contestants if there is considerable (little) mass on favorable draws. We test our theory using both laboratory and field experiments, and find substantial support for our theory in both settings.

DOI

10.1287/mnsc.2019.3441

Volume

66

Issue

10

Pages

4359-4377

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

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