Favoritism of Agents - the Case of Referees' Home Bias
Max Planck Institute for Research into Economic Systems, Papers on Strategic Interaction No. 28-2002
29 Pages Posted: 27 Mar 2003
Date Written: August 2002
We study the behavior of football (soccer) referees in the German Bundesliga. Referees are requested to act as impartial agents. However, they may be tempted to allocate benefits and rewards in a biased way. Agency theory has long neglected this form of malfeasance of economic agents, but has rather concentrated on agents exerting suboptimal effort levels. Favoritism or biased behavior of referees can be investigated by examining their decisions on awarding penalties or extra time at the end of a football match. We can confirm a systematic home bias of referees.
Keywords: agency theory, favoritism, social pressure, referee, German Bundesliga
JEL Classification: D21, D73
Suggested Citation: Suggested Citation