Speaker: Ye Yuan, Peking University

Time: Nov. 26 (Fri.), 15：00 – 16：30

Title:  Air Pollution and Competitive Performance in Tournaments

About the Speaker:

Ye YUAN, PhD., is an Assistant Professor in the School of Economics at Peking University. He received his PhD in Economics from National University of Singapore. Prior to joining Peking University in 2019, he served as a fulltime lecturer at National University of Singapore from 2017 to 2019. His research interest is health, healthcare, education, and public policy evaluation. His research has been published in Lancet, Journal of Economic Behavior and Organization, and China Economic Review. 

Abstract:

We investigate the impacts of air pollution on competitive performance and equilibrium outcomes in a tournament setting. Air pollution reduces a team’s productivity and increases its marginal effort cost. We show in a standard tournament model that air pollution could lead to either a more elitist distributional outcome---i.e., a weaker team’s equilibrium winning probability decreases---or the opposite. In the empirical investigation, we exploit the hourly variation in levels of air pollution and a comprehensive dataset of performance metrics for professional eSports tournaments. We find robust evidence that an increase in the level of air pollution has a significantly negative effect on the weaker team's performance and winning probability, and has a positive effect on the stronger team, thus widening the performance gap between teams. Our finding has broader implications on the average and distributional impact of air pollution on economic outcomes in a strategic environment.