Looking Awkward When Winning and Foolish When Losing: Inequity Aversion and Performance in the Field

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

No 230, School of Economics and Finance Discussion Papers and Working Papers Series from School of Economics and Finance, Queensland University of Technology

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 inequity aversion using two unique panel data sets for basketball and soccer players. We find support that the concept of inequity aversion helps to understand how the relative income situation affects performance in a real competitive environment with real tasks and real incentives.

Keywords: Inequity 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-evo, nep-exp, nep-ltv and nep-upt
Date: Written
Note:  Benno Torgler and Markus Schaffner, The School of Economics and Finance, Queensland University of Technology, GPO Box 2434, Brisbane, QLD 4001, Australia, benno.torgler@qut.edu.au; markus.schaffner@qut.edu.au. Bruno S. Frey, Institute for Empirical Research in Economics, University of Zurich, Switzerland, bsfrey@iew.uzh.ch. Sascha L. Schmidt, European Business School, Oestrich Winkel, Germany, sascha.schmidt@ebs.de. Benno Torgler, Bruno Frey and Sascha Schmidt are also associated with CREMA – Center for Research in Economics, Management and the Arts, Switzerland. Benno Torgler and Bruno S. Frey are also associated with CESifo, Poschingerstrasse 5, D-81679 Munich, Germany. Please address all correspondence to Benno Torgler. We wish to thank Uwe Dulleck and Rosemary Brown for helpful comments and suggestions.
View list of references

Downloads: (external link)
http://www.bus.qut.edu.au/faculty/schools/economic ... /2008/230Torgler.pdf (application/pdf)

Related works:
Working Paper: Looking Awkward When Winning and Foolish When Losing: Inequity Aversion and Performance in the Field (2008)
Working Paper: Looking Awkward When Winning and Foolish When Losing: Inequity Aversion and Performance in the Field (2008)
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:qut:dpaper:230

Access Statistics for this paper

More papers in School of Economics and Finance Discussion Papers and Working Papers Series from School of Economics and Finance, Queensland University of Technology
Contact information at EDIRC.
Series data maintained by Dr Vlad Pavlov ().