Contests, Grand Prizes, and the Hot Hand

Todd A. McFall, Charles R. Knoeber and Walter Thurman
Additional contact information
Todd A. McFall: Welch Consulting
Charles R. Knoeber: North Carolina State University, charles_knoeber@ncsu.edu

Journal of Sports Economics, 2009, vol. 10, issue 3, 236-255

Abstract: Awarding a grand prize to the player who wins most often in a series of contests links the contests together and makes incentives in the current contest depend on past performance. A lucky player who wins early faces relatively stronger economic incentives to exert effort because of his early success. As a consequence, early winners are more likely to keep winning through the middle of the series. That is, a grand prize generates what looks like a hot hand. Indeed, this argument about economic incentives may help to rationalize the inconsistent evidence of a hot hand in sporting events. This article develops this argument and assesses it empirically using data from the Professional Golfers' Association Tour, before and after a grand prize, the season-ending Tour Championship, was introduced.

Keywords: tournaments; contests; grand prize; hot hand; professional golf (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (20)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:jospec:v:10:y:2009:i:3:p:236-255

DOI: 10.1177/1527002508326683

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