Skills, Purses, and Performance in Professional Golf

We examine the steady state properties of a dynamic model of skill acquisition to understand performance in a tournament setting. Empirically, we examine trends in professional golf earnings distributions and in the relative performance of U.S. and European professional golfers. We also estimate the relationship between real purses and scoring among above average and below average PGA tour golfers in the U.S. The empirical work indicates that the performance of less skilled professional golfers has improved relative to higher skilled golfers in periods of rising real purses and increases in purse spreads that favor the better golfers. We argue that increased investment in acquired skills across the skill distribution can lead to relative performance gains by the lesser skilled players because their marginal product of acquired skill exceeds that of the better players.