Favoritism Under Social Pressure

University of Chicago, GSB Working Paper

37 Pages Posted: 22 Jul 2001

See all articles by Luis Garicano

Luis Garicano

Centre for Economic Policy Research (CEPR); IE Business School

Ignacio Palacios-Huerta

London School of Economics; Ikerbasque Foundation UPV/EHU

Canice Prendergast

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: June 2001

Abstract

This paper provides empirical evidence of favoritism by agents, where that favoritism is generated by social pressure. To do so, we explore the behavior of professional soccer referees. Referees have discretion over the addition of extra time at the end of a soccer game (called injury time), to compensate for lost time due to unusual stoppages. We test for systematic bias shown by Spanish referees in favor of home teams. We show that referees systematically favor home teams by shortening close games where the home team is ahead, and lengthening close games where the home team is behind. They show no such bias for games that are not close. We further show that when the rewards for winning games increase, referees change their bias accordingly. We also identify that the mechanism through which bias operates is the referees' desire to satisfy the crowd, by documenting how the size and composition of the crowd affect referee favoritism.

Keywords: Incentives, Bias, Tournaments, Social Interactions, Sports

JEL Classification: D8, J4, L2

Suggested Citation

Garicano, Luis and Garicano, Luis and Palacios-Huerta, Ignacio and Prendergast, Canice, Favoritism Under Social Pressure (June 2001). University of Chicago, GSB Working Paper, Available at SSRN: https://ssrn.com/abstract=274934 or http://dx.doi.org/10.2139/ssrn.274934

Luis Garicano (Contact Author)

Centre for Economic Policy Research (CEPR)

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United Kingdom

IE Business School ( email )

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Ignacio Palacios-Huerta

London School of Economics ( email )

Dept. of Management
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Ikerbasque Foundation UPV/EHU ( email )

Canice Prendergast

University of Chicago - Booth School of Business ( email )

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National Bureau of Economic Research (NBER)

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