Contests & Conflict | 03/24/2021 | 06:00 PM
Moral Transgression: The Impact of Competition

Speaker: Petra Nieken

Petra Nieken will present her paper titled "Moral Transgression: The Impact of Competition" (joint work with Simon Dato and Eberhard Feess).

Abstract of the paper:
Corporate Scandals such as the ones at Wells Fargo, Sears, or Enron as well as doping scandals in professional sports suggest that highly competitive environments do not only increase effort but also unethical behavior. In line with this, experimental studies find that subjects in the laboratory cheat more in contests compared to non-strategic settings. But can this be attributed to a behavioral effect of competition, often referred to as a "desire to win"? Or is the reason simply that incentives differ since winning in contests yields a discrete jump in the payoff structure? To disentangle these two effects, we compare a contest to a non-strategic setting without competition. Crucially, the expected financial benefits from behaving unethically and the impacts on other participants are exactly the same in both treatments. This allows us to isolate the pure behavioral impact of competition. We find that unethical behavior is more frequent in contests even when all differences except the "desire to win" are eliminated by design.

Chair: Dan Kovenock, Co-Chair: Iryna Topolyan

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Max-Planck-Institut für Steuerrecht und Öffentliche Finanzen

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