Tournament Theory, Work, School

"I'm damn sian of work la. So stress la."

"I swear that f***er is a total jerk/bitch. Totally cannot stand him/her."

Sounds familiar? These are what we hear almost everyday in work/school. But is there an economic theory behind all these sianness/cursing in workplace/school? I bet that all of you, upon reading this point, will not see any bloody links between them. Well before this, let me simply introduce a few simple terms.

Tournament Theory simply means rewarding of one relative to the other party(s). Such rewardings were made because its relatively easier to monitor relative performances of different people. One example would be the clash of tennis champions Federer and Nadal. I'm sure they isn't an index or whatsoever to measure their strength i.e Federer 99 points, Nadal 98 points. Hence, monitoring relative performances is much easier. Whoever holds the game better, plays harder, score more aces and win the match is the winner.

Second, these kind of tournament environment tends to thrive when the reward prize is very large. For tennis, only the champion wins the cup and the prize money between the first and second is usually crazy. Also because of these huge incentive difference, these tennis stars are more willing to train harder to seize the championship.

As we can see, one main advantage of tournament environment is incentivizing individuals. Whoever works relatively harder ( I will get back to this ) will win. Now, changing the settings to a typical office, tournament tends to reward those that are relatively more hardworking, smarter etc. But is this always true?

Remember, humans are always rational and always respond to incentives. No people working in a corporate will want to stay as a bell boy/office lady forever. Of course, they seek to climb the ladder, as promotions come with higher pay ( and of course more sai kang )

So how would rational beings respond to tournament environment? First, they work hard. And second, they make sure people around them doesn't work hard - via sabo-ing their colleagues etc. Tournament environment therefore creates too much competition and hence, back-stabbing, saboing, office politics are inevitable.

Of course, the setting could be easily applied on school settings. But its really interesting to observe the fact that rational beings aren't always good souls. So to put it across, rationality does not equal social good.

Felt enlightened anyone? =)

From : Tim Harford - The Logic of Life