Universität zu Köln

Guertler, Marc and Guertler, Oliver (2015). The Optimality of Heterogeneous Tournaments. J. Labor Econ., 33 (4). S. 1007 - 1043. 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 Guertler, Marc UNSPECIFIED UNSPECIFIED UNSPECIFIED Guertler, Oliver UNSPECIFIED UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-391682
DOI:	10.1086/681207
Journal or Publication Title:	J. Labor Econ.
Volume:	33
Number:	4
Page Range:	S. 1007 - 1043
Date:	2015
Publisher:	UNIV CHICAGO PRESS
Place of Publication:	CHICAGO
ISSN:	1537-5307
Language:	English
Faculty:	Unspecified
Divisions:	Unspecified
Subjects:	no entry
Uncontrolled Keywords:	Keywords Language RANK-ORDER TOURNAMENTS; PROMOTION TOURNAMENTS; EMPIRICAL-ANALYSIS; SELECTION; SABOTAGE; PRODUCTIVITY; CONTRACTS; PARTICIPATION; COMPENSATION; INFORMATION Multiple languages Economics; Industrial Relations & Labor Multiple languages
URI:	http://kups.ub.uni-koeln.de/id/eprint/39168