Inequality Aversion and Performance in and on the Field

Benno Torgler (), Markus Schaffner (), Bruno S. Frey (), Sascha Leonard Schmidt () and Uwe Dulleck ()

No 36, NCER Working Paper Series from National Centre for Econometric Research

Abstract: The experimental literature and studies using survey data have established that people care a great deal about their relative economic position and not solely, as standard economic theory assumes, about their absolute economic position. Individuals are concerned about social comparisons. However, behavioral evidence in the field is rare. This paper provides an empirical analysis, testing the model of inequality aversion using two unique panel data sets for basketball and soccer players. We find support that the concept of inequality aversion helps to understand how the relative income situation affects performance in a real competitive environment with real tasks and real incentives.

Keywords: Inequality aversion; relative income; positional concerns; envy; social comparison; performance; interdependent preferences (search for similar items in EconPapers)
JEL-codes: D00 D60 L83 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe, nep-lab, nep-ltv and nep-upt
Date: Written
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Related works:
Working Paper: Inequality Aversion and Performance in and on the Field (2008)
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Persistent link: http://EconPapers.repec.org/RePEc:qut:auncer:2008-25

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