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The Distribution of Talent Across Contests

Abstract : Do the contests with the largest prizes attract the most able contestants? To what extent do contestants avoid competition? We show that the distribution of abilities is crucial in determining contest choice. Complete sorting exists only when the proportion of high-ability contestants is small. As this proportion increases, high-ability contestants shy away from competition and sorting decreases, making reverse sorting a possibility. We test our theoretical predictions with a large panel data set containing contest choice over 20 years. We use exogenous variation in the participation of highly able competitors to provide evidence for the relationship among prizes, competition and sorting.
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Submitted on : Thursday, June 17, 2021 - 5:20:45 PM
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Ghazala Azmat, Marc Möller. The Distribution of Talent Across Contests. Economic Journal, Wiley, 2018, 128 (609), pp.471 - 509. ⟨10.1111/ecoj.12426⟩. ⟨hal-03263984⟩

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