Far above others

Dunia López-Pintado () and Miguel Meléndez-Jiménez ()
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Dunia López-Pintado: Universidad Pablo de Olavide

Working Papers from Universidad Pablo de Olavide, Department of Economics

Abstract: We study the role of competitive behavior in a social network. Agents gain a competitive premium by obtaining a higher outcome than their neighbors (i.e., their reference group). We assume societies in which the level of competition can be strong, mild or weak (i.e., agents compare themselves with the best, the average or the worst outcome in their reference group, respectively). Surprisingly, we find that in a more competitive society less aggregate effort is provided. An increase in the density and homogeneity of the network decreases total effort in the strong-competitive case, whereas the opposite occurs in the weak-competitive setting.

Keywords: behavioral economics; reference points; social comparisons; competition; social networks. (search for similar items in EconPapers)
JEL-codes: D01 D85 Z13 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2018-12
New Economics Papers: this item is included in nep-gth and nep-soc
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http://www.upo.es/serv/bib/wps/econ1812.pdf

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Journal Article: Far above others (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:pab:wpaper:18.12

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