Winning by Losing: Incentive Incompatibility in Multiple Qualifiers
36 Pages Posted: 28 Feb 2013 Last revised: 19 Mar 2017
Date Written: November 30, 2014
In sport tournaments, the rules are presumably structured in a way that any participant cannot benefit by losing instead of winning. We show that tournament systems, consisting of multiple round-robin and knock-out tournaments with non-cumulative prizes, which are ubiquitious around the world, are generically incentive incompatible. We use our model to discuss potential remedies and applications.
Keywords: tournaments, design, rules, football, incentives
JEL Classification: Z20, D71
Suggested Citation: Suggested Citation