Friday, 27th January 2017
13:00 - 14:00
CESS Seminar Rooms - 3 George Street Mews
Tournament Entry Under Uncertainty
Many labor markets have tournament mechanisms in pay and promotion schemes. A decade’s worth of research has shown that women shy away from competition compared to men in many domains. However, labor markets often have more uncertainty imbedded in competition than simply the risk of whether one will win the tournament or not. We examine willingness to enter competition under uncertain competitive environments. Specifically, in a laboratory experiment, we vary whether or not the number of winners of the tournament is certain, and whether or not with the relative probabilities of how many winners they will be are known. We find subjects significantly enter competition more frequently as the amount of uncertainty increases. Additionally, the “gender gap” with respect to entry into competition increases as the level of uncertainty within the competitive environment increases.