Incentives in Professional Tennis: Tournament Theory and Intangible Factors
By Steven Seidel and Joshua Silverman
This paper analyzes the incentives of professional tennis players in a tournament setting, as a proxy for workers in a firm. Previous studies have asserted that workers exert more effort when monetary incentives are increased, and that effort is maximized when marginal pay dispersion varies directly with position in the firm. We test these two tenets of tournament theory using a new data set, and also test whether other “intangible factors,” such as firm pride or loyalty, drive labor effort incentives. To do this, we analyze the factors that incentivize tennis players to exert maximal effort in two different settings, tournaments with monetary incentives (Grand Slams) and tournaments without monetary incentives (the Davis Cup), and compare the results. We find that effort exertion increases with greater monetary incentive, and that certain intangible factors can often have an effect on player incentives.
Advisor: Curtis Taylor, Marjorie McElroy | JEL Codes: J31, J33, L38 | Tagged: Compensation, Sports, Tournament Theory
The Marital Wage Premium in the Twenty-First Century: Do married men earn a higher wage rate, and if so, why?
By Hans F. Kist and Yanqi (Halley) Hu
Married men have historically earned higher wages than single men. One of the most prominent explanations for this phenomenon is the theory of intra-household specialization. However, the marriage premium was found to be decreasing up until the early 90’s. In our paper, we have re-examined the wage premium using data from the National Longitudinal Survey of Youth 1979. Our analysis focuses on an early period (1990-1992) and a later period (2002-2006). Our results suggest that the marital wage premium has actually been increasing over time, but that specialization does not do an adequate job of explaining this result.
Advisor: Marjorie McElroy | JEL Codes: J31
