{"title":"On the Incentive Structure of Tournaments: Evidence from the National Basketball Association’s Draft Lottery","authors":"Martin B. Schmidt","doi":"10.1057/s41302-024-00272-7","DOIUrl":null,"url":null,"abstract":"<p>Tournament theory analyzes labor market outcomes where rewards are distributed on the basis of relative rank. An important factor in these outcomes is the likely return to additional effort. Using National Basketball Association game event data across two seasons, we estimate each team’s game player portfolio and find that teams who were in contention to win the draft lottery reduce their portfolio’s return differential during the 2017–2018 season but not for the 2018–2019 season. We attribute the change to the reduction in the probability of obtaining a higher pick for the 2019 draft.</p>","PeriodicalId":45363,"journal":{"name":"Eastern Economic Journal","volume":"51 1","pages":""},"PeriodicalIF":1.1000,"publicationDate":"2024-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Eastern Economic Journal","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1057/s41302-024-00272-7","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"ECONOMICS","Score":null,"Total":0}
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Abstract
Tournament theory analyzes labor market outcomes where rewards are distributed on the basis of relative rank. An important factor in these outcomes is the likely return to additional effort. Using National Basketball Association game event data across two seasons, we estimate each team’s game player portfolio and find that teams who were in contention to win the draft lottery reduce their portfolio’s return differential during the 2017–2018 season but not for the 2018–2019 season. We attribute the change to the reduction in the probability of obtaining a higher pick for the 2019 draft.
期刊介绍：
The Eastern Economic Journal, a quarterly publication of the Eastern Economic Association, was established in 1973. The EEJ publishes papers written from every perspective, in all areas of economics and is committed to free and open intellectual inquiry from diverse philosophical perspectives. It welcomes manuscripts that are methodological and philosophical as well as empirical and theoretical. Readability and general interest are major factors in publication decision.
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