Rankings, Success, and Individual Performance: Evidence from a Natural Experiment
University of St. Gallen - SEPS: Economics and Political Sciences; University of St. Gallen - Swiss Institute for International Economics and Applied Economic Research
December 17, 2013
U. of St. Gallen Law & Economics Working Paper No. 2013-13
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.
Number of Pages in PDF File: 50
Keywords: Performance, Success, Rankings, Media Attention, Skiing
JEL Classification: D03, L83, M50
Date posted: October 16, 2012 ; Last revised: January 15, 2014