January 2025
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7 Reads
Journal of Economic Behavior & Organization
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Publications (158)
August 2024
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12 Reads
Academy of Management Proceedings
January 2024
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4 Reads
SSRN Electronic Journal
August 2023
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14 Reads
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4 Citations
Journal of Economic Psychology
July 2023
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59 Reads
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5 Citations
Journal of Sports Economics
While second-tier stars lack popularity compared to superstars, their marginal contribution to team performance on the pitch relative to that of superstars is unknown. Relying on league-specific preseason market value distributions to define superstars and second-tier stars, we compare the marginal contributions of superstars and second-tier stars to team performance on the pitch in the top five European football leagues. Examining the impact of unexpected injury-related absences, we find that second-tier stars’ marginal contribution is at least equal to that of superstars. Thus, the players with arguably the highest costs for clubs do not contribute accordingly to short-run sportive success.
June 2023
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14 Reads
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1 Citation
Economic Inquiry
We study whether outcome bias persists in markets with actors who are financially incentivized to make optimal decisions. We test whether inherently noisy match outcomes from European football are correctly incorporated into prices from a betting exchange market. We find that market prices overestimate (underestimate) the winning probability of teams that previously overperformed (underperformed) in terms of match outcomes compared to their performance based on “expected goals.” This pattern is mirrored in negative (positive) betting returns on overperforming (underperforming) teams. These results suggest that even competitive market mechanisms fail to completely erase outcome bias.
January 2023
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1 Read
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1 Citation
SSRN Electronic Journal
December 2022
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12 Reads
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1 Citation
SSRN Electronic Journal
We examine whether finance professionals deviate from Bayes’ theorem on the processing of nondiagnostic information when forecasting quarterly earnings. Using field data from sell-side financial analysts and employing a regression discontinuity design, we find that analysts whose forecasts have barely been met become increasingly optimistic relative to when their forecasts have barely been missed. This result is consistent with an update of analysts’ expectations after observing uninformative performance signals. Our results also suggest that this behavior leads to significantly worse forecasting accuracy in the subsequent quarter. We contribute to the literature by providing important field evidence of expectation formation under uninformative signals.
September 2022
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83 Reads
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7 Citations
Journal of Economic Behavior & Organization
Exploiting a quasi-experimental field setting, we examine whether people are outcome biased when self-evaluating their past decisions. Using data from Swiss driving license exams, we find that candidates who narrowly passed the theoretical driving exam are significantly less likely to pass the subsequent practical driving exam – which is taken several months after the theoretical exam – than those who narrowly failed. Those candidates who passed the theoretical exam on their first attempt receive more objections regarding their momentary, on-the-spot decisions in the practical exam, consistent with the idea that the underlying behavioral difference is worse preparation.
March 2022
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17 Reads
SSRN Electronic Journal
Employing a quasi-experimental field setting, we examine whether people are outcome biased when self-evaluating their past decisions. Using data from Swiss driving license exams, we find that candidates who narrowly passed the theoretical driving exam are significantly less likely to pass the subsequent practical driving exam – which is taken several months after the theoretical exam – relative to those who failed narrowly. The candidates who passed the theoretical exam in their first attempt received more objections in momentary, on-the-spot kinds of decisions, consistent with the idea that worse preparation is the underlying behavioral difference.
Citations (58)
... This evidence is broadly in line with Flurin Meier et al. (2023), who find on different sports that coaches change the starting lineup more often after narrow losses than after narrow wins. The rest of covariates are not found to be significant for explaining manager's perseverance. ...
- Citing Article
August 2023
Journal of Economic Psychology
... Given the influx of talent to the SPL in the summer of 2023, a natural follow-up question is whether the League's perceived increase in attractiveness around the globe emerges from the abundance of (super) stars or any consequential increase in the quality of football. Alternatively, future research might want to: (1) explore potential saturation effects from (too many) stars overshadowing (domestic) talent (e.g., see Jedelhauser et al. (2022) on the German Bundesliga); (2) ...
- Citing Article
July 2023
Journal of Sports Economics
... Outcome bias explains how people judge the outcomes of an event in hindsight. The decisions made in the time of crisis are viewed more negatively if they led to failure, but more positively if they led to success (Meier et al., 2022). Industry practitioners experience the same fallacy i.e., a history of previous successes inhibits their awareness of potential threats. ...
- Citing Article
- Full-text available
September 2022
Journal of Economic Behavior & Organization
... Existing organizational forms in business can lose their efficiency and effectiveness over time (Picot et al. 2020a). Solutions and action strategies that companies have been able to use successfully in the past to realize business opportunities can become outdated as society, markets, technologies, organization possibilities or regulation change. ...
- Citing Book
January 2020
... Some of the common strategies include betting on home favorites or underdogs (e.g., Gandar et al., 2001;Humphreys et al., 2013;Winkelmann et al., 2021), the "hot hand" eect (e.g., Paul et al., 2014a), and the over-the-line option regarding the total number of points scored in a game (e.g., Shank, 2019). Existing research has also considered betting strategies around weather conditions (Borghesi, 2007;Paul et al., 2014b), player exertion on the eld , league and scheduling design (Deutscher et al., 2018;Sung, 2020), and games played during the COVID-19 pandemic (Meier et al., 2021). ...
- Citing Article
August 2021
International Journal of Sport Finance
... If bookmakers do not incorporate such information in their calculation of betting odds, this could lead to inefficiencies that could potentially be exploited by bettors. Merz et al. (2021) do indeed report that bookmakers do not adequately incorporate comprehensive performance information from previous matches when deriving odds, instead relying too heavily on the pure outcome and not factoring in the element of chance (e.g. that a team might have lost despite playing well). Despite urge phases seem to alternate, especially towards the end of the match between minutes 60 and 80, the corresponding win probability -derived by the in-game odds -does not fluctuate accordingly. ...
- Citing Article
August 2021
SSRN Electronic Journal
... After establishing these two groups they waited a month before buying and then held purchases for one month before selling. 5 Investment in a firm by its customers may be due to the affect heuristic; for an application see Merz et al. (2021). ...
- Citing Article
- Full-text available
May 2021
Journal of Behavioral and Experimental Economics
... In a study closest to our own, Flepp, Meier, and Franck (2021) looked at the behavior of casino patrons using data recorded from individual player cards of gamblers visiting a Swiss casino. They found evidence for the realization effect: Visitors tended to increase their risk-taking following losses within a gambling session but decreased their risk-taking on the next casino visit after a losing session, which Flepp, Meier, and Franck (2021) argue to be analogous to a realized outcome. ...
- Citing Article
- Full-text available
July 2021
Organizational Behavior and Human Decision Processes
... In principle, we agree on the ideas underpinning Financial Fair Play. Therefore, the next step is to initiate a discussion of how Financial Fair Play can be made more efficient rather that concluding that it is a complete failure (Franck, 2018(Franck, , 2021. This should include a debate on how media income should be distributed both within national leagues and from European competitions, and perhaps also daring to initiate a discussion on players' salaries and agents' fees. ...
- Citing Chapter
January 2021
... Betting odds can provide an indication, with bookmakers expected to factor in potential spectator influences (Meier et al., 2021;Winkelmann et al., 2021). Remarkably, second division home teams with the most limited attendance matches 5 showed significantly smaller odds differences compared to those with only a few such matches (-0.66 vs -1.71; p-value<0.001), ...
- Citing Article
August 2020
SSRN Electronic Journal