TITLE

Social Loss Aversion and Optimal Contest Design

AUTHOR(S)
Lim, Noah
PUB. DATE
August 2010
SOURCE
Journal of Marketing Research (JMR);Aug2010, Vol. 47 Issue 4, p777
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
When managers are designing a contest to motivate effort by salespeople, service employees, franchisees, or product development teams, a key question is, What should the optimal proportion of winners and losers be? Prevailing marketing theory predicts that the proportion of winners in a contest should always be lower than the proportion of losers. Not only has this theory not been empirically tested, but it is also based on the assumption that contestants care solely about the value of the prizes they receive. This self-interested assumption has been increasingly challenged in marketing and economics. This article uses a behavioral economics model to formalize the idea that if contestants also care about their contest outcomes relative to other contestants, changing the proportion of winners in a contest can alter the reference points contestants use to make these social comparisons. Consequently, a contest with a higher proportion of winners than losers can yield greater effort than one with fewer winners than losers if the degree of social loss aversion in the contestants is sufficiently strong. Two incentive-aligned experiments show that this prediction can be valid in situations with public announcements of contest outcomes.
ACCESSION #
52119028

 

Related Articles

  • What the scoreboard doesn't show. Bell, Susan // Christian Science Monitor;7/9/98, Vol. 90 Issue 157, p8 

    Explains how the author tried to teach her son that winning is not the most important thing in life. The difficulty raising kids in a culture that measures everything; Enjoying the benefits of participation.

  • Winning is fun-d-mental. Davis, Byron // Swimming World & Junior Swimmer;Aug98, Vol. 39 Issue 8, p13 

    Explains the key steps in the process of winning. Winning as basic part of a person's growth and development; Requirements and benefits of winning.

  • Bobcats record with victory over Hornets.  // Twin Cities News (Munday, TX);10/9/2008, Vol. 26 Issue 41, p1 

    The article reports on the victory of Bobcats team from Rule over Hornets of Aspermont on their long time rival which was held at Rule, Texas on October 3, 2008.

  • Seventh grade earns 14-12 win over Edgewood.  // Malakoff News (TX);10/30/2009, Vol. 100 Issue 44, p2B 

    The article reports on the victory of the Malakoff Middle School seventh grade Tigers in Texas over the Edgewood in a football competition.

  • Etiquette.  // Time;7/27/1998, Vol. 152 Issue 4, p15 

    Presents a chart of famous sore winners in history. French World Cup soccer coach Aime Jacquet; Others.

  • Duplicate Bridge winners.  // Adirondack Daily Enterprise;6/1/2010, Vol. 117 Issue 129, p3 

    The article announces the winners of the duplicate bridge in Saranac Lake, New York which includes Deborah Kanze, Carol Burger, and Jeanne DeMattos.

  • Chavez's shirt design wins 'Rose' contest. Parsons, Burlon // East Bernard Express (TX);3/27/2008, Vol. 65 Issue 13, p1 

    The article reports on the success of the T-shirt design of Caitlin Chavez in winning the contest for the "Run for the Rose" in Texas.

  • Sri Lanka Defeats India by Six Wickets.  // India -- West;6/11/2010, Vol. 35 Issue 29, pC22 

    The article offers information on the six- wicket victory of Sri Lanka over India in the in the fifth match of the Micromax Cup Triangular One-Day series at the Harare Sports Club.

  • Zimbabwe Wins to Complete Double over India.  // India -- West;6/11/2010, Vol. 35 Issue 29, pC23 

    The article discusses the complete seven-wicket win of Zimbabwe over India during the Micromax Cup Triangular One-Day series at the Harare Sports Club.

Share

Read the Article

Courtesy of VIRGINIA BEACH PUBLIC LIBRARY AND SYSTEM

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics