Feedback in Tournaments Under Commitment Problems: Theory and Experimental Evidence

40 Pages Posted: 21 Nov 2007

See all articles by Oliver Gürtler

Oliver Gürtler

University of Bonn - Economic Science Area

Christine Harbring

University of Cologne; IZA Institute of Labor Economics

Date Written: October 2007

Abstract

In this paper, we analyze a principal's optimal feedback policy in tournaments. We close a gap in the literature by assuming the principal to be unable to commit to a certain policy at the beginning of the tournament. Our analysis shows that in equilibrium the principal reveals intermediate information regarding the agents' previous performances if these performances are not too different. Moreover, we investigate a situation where the principal is not able to credibly communicate her information. Having presented our formal analysis, we test these results using data from laboratory experiments. The experimental findings provide some support for the model.

Keywords: tournament, commitment problems, feedback, experiment

JEL Classification: C91, D83, J33, M52

Suggested Citation

Gürtler, Oliver and Harbring, Christine, Feedback in Tournaments Under Commitment Problems: Theory and Experimental Evidence (October 2007). IZA Discussion Paper No. 3111, Available at SSRN: https://ssrn.com/abstract=1031686 or http://dx.doi.org/10.2139/ssrn.1031686

Oliver Gürtler

University of Bonn - Economic Science Area ( email )

Adenauerallee 24-42
D-53113 Bonn
Germany
+49 228 739214 (Phone)
+49 228 739210 (Fax)

Christine Harbring (Contact Author)

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany
+ 49 (0) 221 / 470 - 7955 (Phone)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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