Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/266187 
Year of Publication: 
2022
Series/Report no.: 
ECONtribute Discussion Paper No. 181
Version Description: 
September 2022 (updated version)
Publisher: 
University of Bonn and University of Cologne, Reinhard Selten Institute (RSI), Bonn and Cologne
Abstract: 
In many situations, agents take risks by choosing an action that increases their performance immediately, but that potentially leads to a large loss. The current paper studies how such risk-taking behavior depends on the level of competition that the agents face. We study a tournament model and we find that more intense competition, measured by the number of competitors as well as their relative standing, induces agents to take higher risks. We use a rich panel data set on professional biathlon competitions as well as survey data from professional biathletes to confirm the model predictions. Finally, we discuss implications for organizational decision-making.
Subjects: 
Risk-taking
competition
tournament
incentives
biathlon
JEL: 
M51
M52
Z22
Document Type: 
Working Paper

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