INCENTIVES AND OUTCOMES IN A STRATEGICSETTING: THE 3-POINTS-FOR-A-WIN SYSTEM INSOCCER

I exploit a major structural change that has occurred in world soccer to study the impact ofincentives on outcomes in a strategic setting. A game-theoretic model is developed thatcaptures some essential strategic elements of soccer vis-à-vis the number of points awardedto a win. The observable implications of the model are tested using a large dataset that spans30 years and 35 countries. The empirical results support the theoretical model and show thatthe 3-point system has led to a statistically significant increase in the expected number ofgoals and a decrease in the fractions of drawn matches.[...]