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Competition and Well-Being

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  • Jordi Brandts
  • Arno Riedl
  • Frans van Winden

Abstract

We study the effects of competition in a context in which people's actions can not be contractually fixed. We find that in such an environment the very presence of competition does neither increase efficiency nor does it yield any payoff gains for the short side of the market. We also find that competition has a strong negative impact on social well-being, the disposition towards others, and individually experienced well-being, the emotional state, of those on the long side of the market. We conjecture that this limits the possibilities of satisfactory interaction in the future and, hence, has negative implications for efficiency in the longer-run.

Suggested Citation

  • Jordi Brandts & Arno Riedl & Frans van Winden, 2004. "Competition and Well-Being," Working Papers 120, Barcelona School of Economics.
    • Handle: RePEc:bge:wpaper:120
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    Cited by:

    1. Brandts, Jordi & Fernanda Rivas, María, 2009. "On punishment and well-being," Journal of Economic Behavior & Organization, Elsevier, vol. 72(3), pages 823-834, December.
    2. Canegallo, Claudia & Ortona, Guido & Ottone, Stefania & Ponzano, Ferruccio & Scacciati, Francesco, 2008. "Competition versus cooperation: Some experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(1), pages 18-30, February.
    3. Arno Riedl, 2009. "Behavioral and Experimental Economics Can Inform Public Policy: Some Thoughts," CESifo Working Paper Series 2902, CESifo.
    4. Roe, Brian E. & Wu, Steven Y., 2009. "Do the Selfish Mimic Cooperators? Experimental Evidence from Finitely-Repeated Labor Markets," IZA Discussion Papers 4084, Institute of Labor Economics (IZA).
    5. Brian Roe & Steven Y. Wu, 2005. "Social Preferences and Relational Contracting Performance: An Experimental Investigation," Microeconomics 0509006, University Library of Munich, Germany.
    6. Fischer, Justina A.V., 2008. "Is competition good for trust? Cross-country evidence using micro-data," Economics Letters, Elsevier, vol. 100(1), pages 56-59, July.
    7. Juan José Barrios, 2014. "Culture, competition, and happiness," Documentos de Investigación 99, Universidad ORT Uruguay. Facultad de Administración y Ciencias Sociales.
    8. Schwieren, Christiane & Weichselbaumer, Doris, 2010. "Does competition enhance performance or cheating? A laboratory experiment," Journal of Economic Psychology, Elsevier, vol. 31(3), pages 241-253, June.
    9. Rode, Julian, 2008. "Truth and trust in communication : experiments on the effect of a competitive context," Papers 08-04, Sonderforschungsbreich 504.
    10. Rode, Julian, 2010. "Truth and trust in communication: Experiments on the effect of a competitive context," Games and Economic Behavior, Elsevier, vol. 68(1), pages 325-338, January.
    11. van Ypersele, Tanguy & Francois, Patrick, 2009. "Doux Commerces: Does Market Competition Cause Trust?," CEPR Discussion Papers 7368, C.E.P.R. Discussion Papers.
    12. Juan Barrios, 2015. "“I Think Competition is Better Than You Do: Does It Make Me Happier?” Evidence from the World Value Surveys," Journal of Happiness Studies, Springer, vol. 16(3), pages 599-618, June.
    13. Rode, Julian, 2007. "Truth and Trust in Communication: An Experimental Study of Behavior under Asymmetric Information," Ratio Working Papers 111, The Ratio Institute.
    14. Román Andrés Zárate, 2012. "Peer Effects, Cooperation and Competition in Human Capital Formation," Documentos CEDE 9795, Universidad de los Andes, Facultad de Economía, CEDE.
    15. Juan José Barrios, 2013. "Competition and wellbeing," Documentos de Investigación 95, Universidad ORT Uruguay. Facultad de Administración y Ciencias Sociales.

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    More about this item

    Keywords

    competition; happiness; well-being; laboratory experiment; emotions; market interaction;
    All these keywords.

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D30 - Microeconomics - - Distribution - - - General
    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General

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