A vast body of empirical studies lends support to the incentive effects of rank-order tournaments. Evidence comes from experiments in laboratories and non-experimental studies exploiting sports or firm data. Selection of competitors across tournaments may bias these non-experimental studies,...

In this paper we are considering an Organization with a central unit and several subunits. The central unit has to solve a coordination problem for the whole Organization, which can be stated as: How can the decisions concerning future acts needing scarce resources being at the central unit's...