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Performance Bonuses and Effort: Evidence from Fight Night Awards in Mixed Martial Arts

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  • Paul Gift

    (Pepperdine Graziadio Business School, Los Angeles, CA 90045, USA)

Abstract

This paper investigates the role of fight night bonus awards on fighter behavior in the Ultimate Fighting Championship (UFC) and World Extreme Cage (WEC) fighting mixed martial arts (MMA) promotions. Behavior is analyzed using detailed fighter performance statistics, exploiting variation in bonus size across events and over time. Findings suggest that fighters are not meaningfully influenced by bonus levels within the range observed in the sample period and possible explanations are discussed. Fight night bonuses appear to serve as a lottery compensation mechanism to ex post reward performances consistent with an MMA promotion’s desires rather than ex ante incentivize such performances. Findings have implications for strategic MMA promoter decisions and contribute more broadly to the personnel economics literature on incentives and compensation.

Suggested Citation

  • Paul Gift, 2019. "Performance Bonuses and Effort: Evidence from Fight Night Awards in Mixed Martial Arts," IJFS, MDPI, vol. 7(1), pages 1-15, February.
    • Handle: RePEc:gam:jijfss:v:7:y:2019:i:1:p:13-:d:207709
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    Cited by:

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    2. Giovanni Bernardo & Massimo Ruberti & Roberto Verona, 2022. "Image is everything! Professional football players' visibility and wages: evidence from the Italian Serie A," Applied Economics, Taylor & Francis Journals, vol. 54(5), pages 595-614, January.

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