Year: 2024
Type: article
Abstract: In this paper we attempt to find the answer to the question of how the professional boxers behave ex post to additional money share negotiated ex ante. We find that for each fighter under a certain stake threshold there is an incentive to put in huge efforts for the forthcoming fight and that above that threshold, the opposite is true leading to a phenomenon of moral hazard. We also find that bargaining is successful in the absence of moral hazard. Finally, the optimal effort of the fighter will increase (decrease) for his (his opponents’) additional outside option.
DOI: 10.47344/z7ewnh34
Author: Murat Issabayev
Institution: Narxoz University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W4403235823