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Ever tried. Ever failed. No matter? On the demotivational effect of losing in repeated competitions


Haenni, Simon (2019). Ever tried. Ever failed. No matter? On the demotivational effect of losing in repeated competitions. Games and Economic Behavior, 115:346-362.

Abstract

Many important life goals require repeated confrontation with competitors. Losing in such competitions may discourage individuals and make them postpone further competitions, thereby harming future prospects. I use data on 44,799 amateur tennis players, who are randomly paired in repeated competitions, to study the causal effect of losing on the time to the next tournament participation. Results show that individuals wait on average 10% longer to enroll again after losing. Furthermore, losing against relatively weaker opponents leads to a discontinuously larger effect than losing against relatively stronger opponents, indicating that individuals do not rationally update beliefs about winning probabilities but instead use their ranking as reference point when evaluating defeats.

Abstract

Many important life goals require repeated confrontation with competitors. Losing in such competitions may discourage individuals and make them postpone further competitions, thereby harming future prospects. I use data on 44,799 amateur tennis players, who are randomly paired in repeated competitions, to study the causal effect of losing on the time to the next tournament participation. Results show that individuals wait on average 10% longer to enroll again after losing. Furthermore, losing against relatively weaker opponents leads to a discontinuously larger effect than losing against relatively stronger opponents, indicating that individuals do not rationally update beliefs about winning probabilities but instead use their ranking as reference point when evaluating defeats.

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Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Economics
Dewey Decimal Classification:330 Economics
Scopus Subject Areas:Social Sciences & Humanities > Finance
Social Sciences & Humanities > Economics and Econometrics
Uncontrolled Keywords:Competition, natural experiment, reference points
Language:English
Date:May 2019
Deposited On:10 Jul 2019 10:38
Last Modified:29 Jul 2020 10:48
Publisher:Elsevier
ISSN:0899-8256
OA Status:Closed
Publisher DOI:https://doi.org/10.1016/j.geb.2019.03.012

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