nep-spo New Economics Papers
on Sports and Economics
Issue of 2020‒12‒07
two papers chosen by
Humberto Barreto
DePauw University

  1. Managerial Beliefs and Firm Performance: Field Evidence from Professional Elite Soccer By David Boto-Garcìa; Alessandro Bucciol; Luca Zarri
  2. Prize sharing rules in collective contests: When does group size matter? By Dhritiman Gupta

  1. By: David Boto-Garcìa (University of Oviedo); Alessandro Bucciol (Department of Economics (University of Verona)); Luca Zarri (Department of Economics (University of Verona))
    Abstract: Using detailed field data covering ten seasons of the Italian soccer premier league, we provide the first evidence on the key role played by managerial beliefs in firm performance in a high-powered incentives natural setting where managers receive frequent feedback. We show that managers’ confidence and risk tolerance positively affect performance. Next, we document asymmetrically biased belief updating, in line with prior laboratory work on non-managers. By shedding light on overlooked features of manager-firm interplays and managers’ information processing, our findings corroborate and help qualify the “managers matter” view advanced in recent fieldwork based on low-frequency data.
    Keywords: Managerial Beliefs, Firm performance, Professional Soccer, Field data
    JEL: D01 D22 D81 D91 L20 Z20
    Date: 2020–11
  2. By: Dhritiman Gupta (Indian Statistical Institute, Delhi)
    Abstract: In this paper we deal with situations of collective contests between two groups over a private prize. A well known way to divide the prize within the winning group is the prize sharing rule introduced by Nitzan (1991). Since its introduction it has become a standard in the collective contests literature. We generalize this rule by introducing a restriction we call norms of competitiveness of a group. We fully characterize how group sizes interact with such norms. What we show is that the smaller group is generally aggressive, but the larger group needs to have really egalitarian norms to behave aggressively in the contest. We also take up the question of how group welfare relates to group sizes under the stated norms. We provide a complete set of conditions under which the larger group fares worse in the contest, a phenomenon called Group Size Paradox (GSP) in the literature.
    Keywords: Rent Seeking, Collective Action, Prize Sharing Rules
    JEL: D23 D71 D72 H41 C72
    Date: 2020–07

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