Splitting Leagues

Matthias Kräkel ()

Bonn Econ Discussion Papers from University of Bonn, Germany

Abstract: Splitting leagues or tournaments seems to be puzzling when agents are homogeneous and splitting leads to a negative competition effect. However, it can be shown that the principal can nevertheless benefit from splitting. First, splitting can be used as a divide-and-rule strategy by the principal to create additional incentives when collusion among the agents is possible. Second, splitting leagues gives the principal the opportunity to introduce promotions and relegations between nested tournaments (i.e., tournaments that are intertemporally linked), which also enhances incentives.

Keywords: collusion; leagues; promotion; relegation; tournament (search for similar items in EconPapers)
JEL-codes: J3 J4 M5 (search for similar items in EconPapers)
Date: 2003-04
View list of references

Downloads: (external link)
ftp://web.bgse.uni-bonn.de/pub/RePEc/bon/bonedp/bgse6_2003.pdf (application/pdf)

Related works:
Journal Article: Splitting Leagues (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:bon:bonedp:bgse6_2003

Access Statistics for this paper

More papers in Bonn Econ Discussion Papers from University of Bonn, Germany
Address: Bonn Graduate School of Economics, University of Bonn, Adenauerallee 24 - 26, 53113 Bonn, Germany
Series data maintained by Daniel Park ().