published in: Journal of Economic Behavior and Organization, 2021, 183, 362-376
Are people prone to selecting occupations with highly skewed income distributions despite minuscule chances of success? Assembling a comprehensive pool of potential teenage entrants into professional tennis (a typical winner-take-all market), we construct objective measures of relative ability and earnings projections. We find that prospective tennis professionals are attracted to right-skewed earnings distributions, independent of mean and variance. If skewness in prize money fell to zero, males would be 23% and females 5% less likely to continue pursuing a professional career, on average. Thus, winner-take-all labor markets appear to systematically encourage those with modest talents to pursue long-shot careers.
We use cookies to provide you with an optimal website experience. This includes cookies that are necessary for the operation of the site as well as cookies that are only used for anonymous statistical purposes, for comfort settings or to display personalized content. You can decide for yourself which categories you want to allow. Please note that based on your settings, you may not be able to use all of the site's functions.
Cookie settings
These necessary cookies are required to activate the core functionality of the website. An opt-out from these technologies is not available.
In order to further improve our offer and our website, we collect anonymous data for statistics and analyses. With the help of these cookies we can, for example, determine the number of visitors and the effect of certain pages on our website and optimize our content.