Universität zu Köln

Gürtler, Marc and Gürtler, Oliver ORCID: 0000-0001-7792-5325 (2015). The Optimality of Heterogeneous Tournaments. Journal of Labor Economics JOLE, 33 (4). 1007 - 1042. CHICAGO: UNIV CHICAGO PRESS. ISSN 1537-5307

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Abstract

We investigate the effect of employee heterogeneity on the incentive to exert effort in a market-based tournament. External employers use promotion decisions to estimate employees' abilities and adjust their wage offers accordingly. Employees exert effort to increase the probability of being promoted and thus to increase their ability assessment and wage offer. We demonstrate that ability assessments and wage offers are more sensitive to promotion decisions in the case of heterogeneous employees. Thus, employees have a higher incentive to affect the tournament outcome, and employers find it optimal to hire heterogeneous employees.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Gürtler, Marc UNSPECIFIED UNSPECIFIED UNSPECIFIED Gürtler, Oliver UNSPECIFIED orcid.org/0000-0001-7792-5325 UNSPECIFIED
URN:	urn:nbn:de:hbz:38-391682
DOI:	10.1086/681207
Journal or Publication Title:	Journal of Labor Economics JOLE
Volume:	33
Number:	4
Page Range:	1007 - 1042
Date:	2015
Publisher:	UNIV CHICAGO PRESS
Place of Publication:	CHICAGO
ISSN:	1537-5307
Language:	English
Faculty:	Faculty of Management, Economy and Social Sciences
Divisions:	Center of Excellence C-SEB Faculty of Management, Economics and Social Sciences > Economics > Microeconomics, Institutions and markets > Professorship for Economics
Subjects:	Economics
Uncontrolled Keywords:	Keywords Language RANK-ORDER TOURNAMENTS; PROMOTION TOURNAMENTS; EMPIRICAL-ANALYSIS; SELECTION; SABOTAGE; PRODUCTIVITY; CONTRACTS; PARTICIPATION; COMPENSATION; INFORMATION English Economics; Industrial Relations & Labor English
Related URLs:	Publication
Refereed:	Yes
URI:	http://kups.ub.uni-koeln.de/id/eprint/39168