Peloton Peers: The Effect of Targets on Performance
36 Pages Posted: 25 Dec 2015 Last revised: 7 Feb 2019
Date Written: February 5, 2019
Individuals facing competitive targets increase their effort but respond non-monotonically to the targets difficulty. We use a novel dataset of informal amateur cycling competitions to track the responses of individuals to competitively-set targets (in the form of displacement from the top of a leaderboard). Modeling the choice problem of these individuals, we derive a set of testable hypotheses. We find, as predicted by the model, that individuals compete sooner and more intensely after displacement. As our main result, we find an inverted-U relationship between the increase in effort and the size of the displacement.
Keywords: rank incentives, targets, peer competition, effort choice
JEL Classification: J22, M52
Suggested Citation: Suggested Citation