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Category Archives: M

For Love of the Game: A Study of Tournament Theory and Intrinsic Motivation in Dota 2

By YAO Shengjie

This paper studies the effect of intrinsic motivation on the extrinsic incentives specified by tournament structure in tournament theory in the context of e-sports. It incorporates tournament theory and motivation crowding theory in the same framework, something that past literature have hinted towards but never formally done so. It also uses an e-sports dataset, a type of dataset that few academics in the past have dealt with, but one that offers many interesting potentials. Results weakly show that crowding-in occurs in e-sports, but the effects of tournament structure on performance are inconclusive in the context of this paper. Implications of this paper lie mainly in the possibility for future academics to utilise e-sports data for research.

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Advisors: Professor Grace Kim | JEL Codes: J31, J33, J41, M51, M52, Z20

Incentives to Quit in Men’s Professional Tennis: An Empirical Test of Tournament Theory

By Will Walker

This paper studies the influence of incentives on quitting behaviors in professional men’s tennis tournaments and offers broader implications to pay structures in the labor market. Precedent literature established that prize incentives and skill heterogeneity can impact player effort exertion. Prize incentives include prize money and indirect financial rewards (ranking points). Players may also exert less effort when there is a significant difference in skill between the match favorite and the match underdog. Results warrant three important conclusions. First, prize incentives (particularly prize money) do influence a player’s likelihood of quitting. Results on skill heterogeneity are less conclusive, though being the “match favorite” could reduce the odds of quitting. Finally, match underdogs and “unseeded” players may be especially susceptible to the influence of prize incentives when considering whether to quit.

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Advisors: Peter Arcidiacono and Grace Kim | JEL Codes: J41, J31, J32, J33, M12, M51, M52

Gender Equality as a Result of Offering Employee Benefit Policies

By Meghan Mcaneny

In this study, I investigate the relationship between the percentage of women in leadership in a company and its employee benefits. This papeuses data on individual firms’ benefits such as paid parental leave, familial support, and flexibility arrangements. Using OLS, I conclude that benefits that shift familial burdens from women to men, specifically paid paternity leave, result in more women in leadershipThis creates an even playing field for women to be promoted as the company environment does not penalize women for using benefits. I also find a negative relationship between reimbursement for fertility procedures and women in leadership.

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Advisor: Alison Hagy, Marjorie McElroy | JEL Codes: J22, J32, M51, M52 | Tagged: Employee Benefits, Women in Business Leadership, Work-Life Balance

Multiples Valuation and Abnormal Returns

By Joon Sang Yoon

I investigate whether three commonly used valuation multiples—the Price-to-Earnings Ratio, the EV-to-EBITDA multiple, and the EV-to-Sales multiple—can be used to identify mispriced securities. I find that multiples are successful in identifying mispricing in both the equal and value weighted portfolios relative to the One-Factor CAPM. I further find, after controlling for size and value effects, that the bulk of the abnormal returns are concentrated in smaller firms. Moreover, the Sales multiple seems to outperform the other two multiples in the equal weighted design. In the value weighted design, however, the P/E ratio outperforms the others.

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Advisor: Per Olsson | JEL Codes: G12, G14, M4 | Tagged: Equity Valuation, Long-run Abnormal Returns, Market Efficiency, Multiples Valuation

Implications of Teacher Tenure on Teacher Quality and Student Performance in North Carolina

By Dana Fenster

This paper examines the relationship between teacher tenure and teacher quality in North Carolina, measured via student performance on the state End of Grade (EOG) standardized tests. After presenting a comprehensive synopsis of the current teacher tenure policy, I use data from the North Carolina Education Research Data Center (NCERDC) to compare demonstrated teacher effectiveness across the tenure bubble, defined as one to eight years of teaching experience within the same district. Ultimately, I find that there is significant jump in average teacher quality at the tenure cutoff, suggesting that tenure policy is effective in retaining high quality teachers while removing those who are ineffective.

Honors Thesis

Advisor: Hugh Macartney | JEL Codes: I21, J24, J41, M5 | Tagged: Economics of Education, Labor Economics, Teacher Tenure

Geo-Spatial Modeling of Online Ad Distributions

By Mitchel Gorecki

The purpose of this document is to demonstrate how spatial models can be integrated into purchasing decisions for real-time bidding on advertising exchanges to improve ad selection and performance. Historical data makes it very apparent that some neighborhoods are much more interested in some ads than others. Similarly, some neighborhoods are also much more interested in some online domains than others, meaning viewing habits across domains are not equal. Basic data analysis shows that neighborhoods behave in predictable ways that can be exploited using observed performance information. This paper demonstrates how it is possible to use spatially correlated information to better optimize advertising resources.

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Advisor: Charles Becker | JEL Codes: C3, C33, C53, M37 | Tagged: Ad Distribution, Advertising, Online, Real Time Bidding, Spatial

The Effects of Digital Media on Advertising Markets

By Bradford Lightcap

This paper examines the viability of sustained advertising spending in an increasingly digital age. Beginning with print media and through the advent of television, the ad market has seen vast evolution in information consumption. The result has been a creative adaptability by advertisers to keep pace with said change. However, growth in ad spending has not significantly outpaced GDP growth, as documented in the Relative Constancy Hypothesis. RCH asserts that both ad spending and consumer expenditure as a percent of GDP remain steady over time. This paper focuses on whether the advertising claim holds up through the rise of the Internet. How this powerful medium may alter traditional advertising trends remains unclear. The answer could have implications for both advertisers and parties that rely on them

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Advisor: Connel Fullenkamp | JEL Codes: L82, M3, M37, O39 | Tagged: Digital Media, Relative Constancy Hypothesis

The Influence Effect of Critics’ Reviews on Foreign and Domestic Movies

By Jayoung Jeon

Critics and their reviews provide crucial information for consumers in many “experience goods” markets, and the movie market is one such market. Through their impact on the consumer’s film selection, critics’ reviews influence the first weekend box office performance (the influence effect). We hypothesize that the influence effect of critics’ reviews is different for foreign and domestic movies. Using the U.S. film industry as our empirical setting, we examine the effects of reviews on opening weekend revenues in the U.S. film industry. We find that, when the critics’ assessment of domestic movies is positive, people are discouraged from watching the movie. On the other hand, for foreign movies, the impact of positive reviews is found to be positive. We interpret this result as arising from the different target audiences for foreign and domestic movies. Further analysis of our data supports this hypothesis. We also find that people are more influenced to watch movies when they see multiple reviews than only a few of them. This positive impact of the number of critics’ reviews is greater for domestic than foreign movies, and greater for domestic art movies than domestic non-art movies.

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Advisor: James Roberts | JEL Codes: L82, M37 | Tagged: Art, Critics, Films, Foreign, Movies, Reviews

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