Looking Awkward When Winning and Foolish When Losing: Inequity Aversion and Performance in the Field

The experimental literature and studies using survey data have established that people care a great deal about their relative economic position and not solely, as standard economic theory assumes, about their absolute economic position. Individuals are concerned about social comparisons. However, behavioral evidence in the field is rare. This paper provides an empirical analysis, testing the model of inequity aversion using two unique panel data sets for basketball and soccer players. We find support that the concept of inequity aversion helps to understand how the relative income situation affects performance in a real competitive environment with real tasks and real incentives.

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Year of publication:	2008-06-16
Authors:	Torgler, Benno ; Schaffner, Markus ; Frey, Bruno S. ; Schmidt, Sascha L.
Institutions:	School of Economics and Finance, Business School
Subject:	Inequity aversion \| relative income \| positional concerns \| envy \| social comparison \| performance \| interdependent preferences

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Extent:	application/pdf
Series:	School of Economics and Finance Discussion Papers and Working Papers Series.
Type of publication:	Book / Working Paper
Language:	English
Notes:	 Benno Torgler and Markus Schaffner, The School of Economics and Finance, Queensland University of Technology, GPO Box 2434, Brisbane, QLD 4001, Australia, benno.torgler@qut.edu.au; markus.schaffner@qut.edu.au. Bruno S. Frey, Institute for Empirical Research in Economics, University of Zurich, Switzerland, bsfrey@iew.uzh.ch. Sascha L. Schmidt, European Business School, Oestrich Winkel, Germany, sascha.schmidt@ebs.de. Benno Torgler, Bruno Frey and Sascha Schmidt are also associated with CREMA – Center for Research in Economics, Management and the Arts, Switzerland. Benno Torgler and Bruno S. Frey are also associated with CESifo, Poschingerstrasse 5, D-81679 Munich, Germany. Please address all correspondence to Benno Torgler. We wish to thank Uwe Dulleck and Rosemary Brown for helpful comments and suggestions. Number 230 29 pages
Classification:	D00 - Microeconomics. General ; D60 - Welfare Economics. General ; L83 - Sports; Gambling; Recreation; Tourism
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005416594