SMU SOE Seminar (Aug 16, 2018): Lowering the Bar and Limiting the Field: The Effect of Strategic Risk-taking on Selection Contests

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ABSTRACT Contests for grades, promotions, and job assignments which feature lax standards or consider only limited talent pools are often criticised for being unmeritocratic. We show that low standards and exclusivity can further meritocratic selection when contestants are strategic risk takers. Strategic risk taking bounds the gains to meritocratic contest designers from expanding the contestant pool while low standards mollify risk-taking incentives and thereby increase the correlation between selection and ability. The introduction of strategic risk taking thus results in "clubby'' contest designs, featuring less inclusive contestant pools and larger expected rewards to pool members. Click here to view the paper. Click here to view the CV.
		PRESENTER Dawei Fang University of Gothenburg
		RESEARCH FIELDS Contract Theory Game Theory
		DATE: 16 August 2018 (Thursday)
		TIME: 4pm - 5.30pm
		VENUE: Meeting Room 5.1, Level 5 School of Economics Singapore Management University 90 Stamford Road Singapore 178903