Rankings, Success, and Individual Performance: Evidence from a Natural Experiment

50 Pages Posted: 16 Oct 2012 Last revised: 15 Jan 2014

Stefan Legge

University of St. Gallen - SEPS: Economics and Political Sciences; University of St. Gallen - Swiss Institute for International Economics and Applied Economic Research

Lukas Schmid

Date Written: December 17, 2013

Abstract

Rankings have become increasingly important over the past decades and impose a sharp distinction between success and failure. In this paper we examine the effects of ranking positions and great successes on individual performance by using a rich set of data on World Cup alpine ski races for the period of 1992--2013. We apply a regression discontinuity design and exploit close races as a source of quasi-randomized treatment assignment.

Our results suggest substantial short-run effects of podium finishes on performance, especially for racers in the middle of the skill distribution. However, the effects are short-lived and mostly driven by individuals who miss prestigious ranks by a tiny margin. This finding highlights a potential drawback of rankings which has been neglected in previous research. We identify media attention as the key channel for performance effects and provide novel empirical evidence for an increasing media bias in favor of top-ranked competitors in the last two decades.

Keywords: Performance, Success, Rankings, Media Attention, Skiing

JEL Classification: D03, L83, M50

Suggested Citation

Legge, Stefan and Schmid, Lukas, Rankings, Success, and Individual Performance: Evidence from a Natural Experiment (December 17, 2013). U. of St. Gallen Law & Economics Working Paper No. 2013-13. Available at SSRN: https://ssrn.com/abstract=2161903 or http://dx.doi.org/10.2139/ssrn.2161903

Stefan Legge

University of St. Gallen - SEPS: Economics and Political Sciences ( email )

Rosenbergstrasse 51
St. Gallen, St. Gallen CH-9000
Switzerland

University of St. Gallen - Swiss Institute for International Economics and Applied Economic Research

Bodanstrasse 8
St.Gallen, 9000
Switzerland

No contact information is available for Lukas Schmid

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