The Incentive Effects of Appointment Tournaments in German Higher Education

Abstract

In 2001, the German system of higher education went through a set of reforms that - among others - were intended to create appropriate incentives for university professors. Empirically, however, even before the reform, publication records of university professors in German higher education showed consistently high output levels over a long period of academic careers. In this paper, we focus on the incentive effects of the appointment system in German higher education as one explanatory factor of the observed phenomenon. To that aim we extend a standard tournament model by (1) introducing J-curved effort costs and (2) accounting for systematic differences between two basic types of contestants, professors and junior scientists. In a last step of our paper, we use the extended model to analyze the effects of selected elements of the 2001 reform of German higher education on the tournament incentives arising from the appointment system.

Keywords: appointment system, asymmetric tournaments, incentives, intrinsic motivation, handicap, reform of German higher education

JEL Classification: A11, J31, J41, M51, M52