Sabotage in Tournaments: Evidence from a Laboratory Experiment

Christine Harbring () and Bernd Irlenbusch ()
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Christine Harbring: RWTH Aachen University
Bernd Irlenbusch: University of Cologne

No 4205, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Although relative performance schemes are pervasive in organizations reliable empirical data on induced sabotage behavior is almost non-existent. We study sabotage in tournaments in a controlled laboratory experiment and are able to confirm one of the key insights from theory: effort and sabotage increase with the wage spread. Additionally, we find that even in the presence of tournament incentives, agents react reciprocally to higher wages, which mitigates the sabotage problem. Destructive activities are reduced by explicitly calling them by their name 'sabotage'. Communication among principal and agents curbs sabotage due to agreements on flat prize structures and increased output.

Keywords: relative performance scheme; tournament; reciprocity; sabotage; experiment (search for similar items in EconPapers)
JEL-codes: C72 C91 J33 J41 L23 M52 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2009-06
New Economics Papers: this item is included in nep-exp and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published - revised and extended version published in: Management Science, 2011, 57, 611 - 627

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