Experimental Design Details
In our experiment participants are randomly assigned to one of three treatments. Each treatment consists of three effort tasks and concludes with a questionnaire. Treatments are explained in detail below.
Each player plays three main tasks of 90 seconds each. Only one randomly chosen task will be payoff-relevant. In task 1, participants perform a real effort task in which they have to count the number of zeros (0) in ten tables consisting of zeros (0) and ones (1) (Apicella et al., 2017). They are paid according to a piece rate that pays 0.15 pounds per table they solve correctly. In task 2 participants work on the same task but are paid according to a tournament rate that pays 0.30 pounds if the participant’s score (which is the number of tables they solve correctly) exceeds the score of another randomly selected player who has already played the task. Before task 3 is played, we ask players to consider their performance in task 2 and guess their rank compared to other 100 participants in task 2. We call this task the ”Guessing task”. This task is incentivized. We pay a base payment of 0.50 pounds, with a penalty of 0.02 pounds times the absolute difference between the true rank and the stated (guessed) rank. Subsequently participants are given a neutral feedback, i.e., “you won/lost in the tournament”. In task 3, participants work on the same task but before that, they can choose between the piece rate and tournament payment. If the latter is chosen, participants’ scores are matched with the scores of other players who already played the task (different from the opponent in task 2). This guarantees that participants’ decisions in task 3 do not impose an externality on earnings of others.
It is analogous to the “Neutral Treatment” except that before completing task 2, participants are told that in 50% of the cases the winner of the tournament will be the one with the higher score (i.e.: the actual winner) while in the remaining 50% of the cases the winner will be randomly chosen. This means that there is a 25% chance that the player with the highest score will lose undeservedly. Feedback is the same as in the neutral treatment. Since no feedback is given about which of the two above-described scenarios has occurred, participants do not know whether they won/lost deservedly or undeservedly. The tournament in task 3 (if chosen) will be a fair (neutral) tournament in order to both keep the treatments as similar as possible and to avoid that preferences for fair (neutral) competitive environment could play a role in task 3’s decision. This treatment reproduces the features of many real world situations where individuals do not always know whether they won/lost because someone had an unfair advantage or not.
Unfair Feedback Treatment
It is analogous to the “Unfair Treatment” except that players are now told whether they won/lost deservedly or undeservedly the tournament in Task 2. Participants also receive feedback about their true rank in the “Guessing task”.
The experiment ends with a questionnaire asking questions about willingness to take risk, about whether participants think that men or women are better in the counting zero task, socio-economic variables, family background, athletic/sport experience, as well as perception of unfairness and competitive attitudes.