Management Accounting Section Midyear Meeting

Keeping Them in The Game: The Effects of Targets and Quitter Performance Information on Retention in Tournaments

• In Event: Incentives and Compensation IV

Abstract

This study investigates the retention of competitors in tournaments. We examine whether assigning performance targets and the extent of information related to the performance of competitors who have previously quit, affect the retention of competitors in a grand tournament. Our results show an interaction between targets and the informedness of competitors about the performance of quitters. Specifically, concealing relative performance information of competitors who have quit improves retention when performance targets are assigned in tournaments. In contrast, revealing relative performance information of competitors who have quit improves retention when performance targets are not assigned. The effects are stronger as goal difficulty increases. Additional analysis suggests that the persistence of competitors is similarly affected.

Authors

• James Sewell, Monash University

• Axel Klaus-Dieter Schulz, La Trobe University

• Kristian Rotaru, Monash Business School