Tournaments and auctions: Evidence from the field and the greens

Natural and field experiments---on the golf course and on the Internet---provided me with unique opportunities for research. The focus of each part of this dissertation is different; yet, each chapter uses a creative dataset to address testable hypotheses with real-world implications.;Chapter 2 examines the claim that skill heterogeneity can undermine the competitors' incentives in rank-order tournaments. I use panel data from professional golfers and find that the presence of a superstar is associated with lower tournament performance. On average, PGA golfers' first-round and tournament scores are 0.2 and 0.8 strokes higher, respectively, when Tiger Woods participates, relative to when he is absent. The adverse superstar effect increases when Woods plays well and disappears during Woods's weaker periods. There is no evidence that reduced performance is due to "riskier" play.;Chapter 3 explores coexistence in markets with competing auction sites. Ellison, Fudenberg, and Mobius (2004) suggest that seller revenue and buyer-seller ratios should be approximately equal for two sites to coexist. Evidence from field experiments on eBay and Yahoo Auctions is inconsistent with these hypotheses: eBay revenues were 20 to 70% higher and attracted two additional buyers. Platform differentiation, switching costs, trustworthiness and anomalous data do not explain the disparities. Chapter 3 proposes a replicator dynamic in which users imitate successful strategies. Here, tipping is (almost) inevitable, and prices and the buyer-seller ratio have no tendency to equalize.;In Chapter 4, field and natural experiments in online auctions are used to study the revenue effect of varying the disclosure of shipping fees. The main findings are: (1) disclosure affects revenues; (2) increasing shipping charges boosts revenues particularly when these charges are hidden; and (3) the level and disclosure of the shipping charge have little effect on the number of bidders attracted to an auction.