Competition and Cheating: Malfeasance in Tournaments

29 Pages Posted: 26 Jan 2006

Date Written: November 16, 2005

Abstract

In economic contests or tournaments where monitoring of the actions taken by contestants is imperfect competition is likely to drive not just work effort but other choices at the workers' discretion that increase the probability of winning. For example, when workers compete for promotion, bonuses, or other rewards tied to their relative performance ranking vis-à-vis colleagues they may have opportunities to engage in fraud or otherwise misrepresent their output, behaviors that the employer wishes to deter and are thus forms of cheating or malfeasance. We show how the likelihood of cheating depends on the payoffs at stake in the tournament, the variance of output, probability of cheating being detected, number of contestants, and the penalty associated with being found to have cheated.

Keywords: tournaments, malfeasance, cheating

JEL Classification: D21, L20, M51, M52

Suggested Citation

Gilpatric, Scott M., Competition and Cheating: Malfeasance in Tournaments (November 16, 2005). Available at SSRN: https://ssrn.com/abstract=854445 or http://dx.doi.org/10.2139/ssrn.854445

Scott M. Gilpatric (Contact Author)

University of Tennessee ( email )

508 Stokely Management Center
Knoxville, TN 37996-0550
United States
865-974-1696 (Phone)

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